London rental growth last month slowed to the lowest rate in more than three years as tenant demand in the capital weakened.
Private rental prices in London grew 0.9 per cent in the 12 months to October, compared to 1.2 per cent growth the previous month.
It was the biggest slowdown in private rental price growth since March 2017.
London rents recorded the weakest growth in the UK as the number of people moving to the capital for work dipped due to the pandemic and more Londoners decided to leave the city.
South East England, which includes London’s commuter belt, was the next worst affected region, with rental price growth of 1.1 per cent.
Across the UK, private rental prices paid by tenants rose 1.4 per cent in October, a dip on the 1.5 per cent growth recorded in September.
Private rental prices grew by 1.4 per cent in England, 1.6 per cent in Wales and 0.8 per cent in Scotland, according to the Office for National Statistics.
Tenants may be struggling
Franz Doerr, chief executive at rental payments platform Flatfair, said plummeting rental prices “are by no means a cause for celebration”, as it indicates tenants have been struggling to pay rent.
“Both landlords and tenants alike have been badly impacted by the fallout of Covid-19,” he said.
“With the majority of those working in the beleaguered hospitality and service industry renting privately, many are facing the prospect of soon being unable to pay the rent having been placed on furlough or, worse still, made redundant.
“And while many whitecollar renters, particularly in London, may have kept their job and simply decided to move somewhere cheaper or with more space, those who haven’t been so lucky could be leaving the capital simply because they can no longer sustain themselves there, driving down rents as a result.”