Steep rental discounts in prime central London have begun to lure tenants back to the city, according to a new report on Monday.
A wave of renters whose budgets previously could not accommodate London prices are trading in their homes on the fringe of the city in favor of trendy, centrally located neighborhoods like Canary Wharf, Chelsea and South Kensington, according to London-based real estate firm Knight Frank. It goes to show that city living and walkability remain appealing even as the Covid-19 pandemic and renewed lockdowns drag on.
The number of rental viewings in prime central London were up 24% in the year through January compared to the previous 12 months, while rental viewings in suburban south-west London and the so-called home counties, popular commuter areas, have plummeted 35% in that time.
Similarly, the brokerage has recorded an 8% increase in rental hunters in prime central London during that time, compared with a 15% decrease in the city’s suburban south west.
“There has always been a group of people living on the periphery of central London who couldn’t afford to go in any further,” said David Mumby, head of Prime Central London lettings at Knight Frank. “That has changed, and we’re seeing movement from areas including Wandsworth and as far away as Croydon into Chelsea and South Kensington.
Prime central London hasn’t looked this affordable in more than a decade, Mr. Mumby said.
Average rents there were down 13% in January compared to a year ago, bringing them to levels last recorded during the global financial crisis of 2009, by Knight Frank’s measure.
In the absence of tourism, a wave of previously short-term rentals have inundated the long-term rental market with excess supply; while at the same time, fewer overseas students and corporate tenants have reduced overall demand for central London rentals. Together, those forces are behind the steep fall in rental prices, according to Knight Frank.
Article Source: Mansion Global