London only UK region to report drop in rent prices over last five years
The capital is the only region in the UK where rents have fallen over the last five years as Londoners have left the city during the pandemic and fewer young professionals have moved for work.
Asking rents in almost two thirds – 65 per cent – of London neighbourhoods are lower than they were five years ago, compared to just four per cent across the rest of Britain.
London is the only region where asking rents have fallen compared to 2016 levels, down 2.6 per cent.
Research by Rightmove, based on more than 900,000 properties, showed that the decline is being driven by inner London areas – where asking rents are down 6.5 per cent compared to the first quarter of 2016.
Rental prices in outer London have held up, and have grown by two per cent in the same time period.
The research also showed that available rental stock in the capital is up by 19 per cent compared to pre-pandemic levels in 2019.
Meanwhile, demand outside the capital has seen available rental stock fall by 54 per cent.
Nationally, rents outside London have hit a record high at £982 per month, up 4.2 per cent on the first quarter rent and the highest annual rate since 2015.
Rightmove’s director of property data Tim Bannister said: “Our data shows a stark contrast between the rental market in central areas of London and the market across the rest of Great Britain.
“Agents are telling me that they don’t have enough rental stock to meet the demand from tenants in many areas, while in London there will be some tenants who have a lot more stock to choose from.
“Landlords who five years ago took a longer term view obviously couldn’t foresee the effect that Covid would have on rents, and right now they’ll be doing all they can to prevent voids and hope the drop in rents is fleeting.
“The frenzied buying and selling market is likely to be exacerbating the problem as well, as some sellers are moving into rental accommodation until they find the home they want to buy, adding further demand to already diminishing rental stock levels.”