Fall in demand for London rental properties, say landlords

Tenant demand in London’s private rental sector is falling overall, while significant increases are being seen elsewhere in England and Wales, according to landlords.

More than half (56%) of landlords with properties in central London saw tenant demand fall in the first quarter of 2021 compared with the same period in 2020, a survey of National Residential Landlords Association (NRLA) members found.

Some 12% reported that demand had increased.

Further out in London’s suburbs, 45% of landlords reported demand having fallen, with 33% saying it had increased.

Central and outer London continued to be the only regions where a significant proportion of landlords reported that rents were falling, the report said.

The findings buck trends seen elsewhere across England and Wales.

Tenant demand was found to be strongest in Wales, the NRLA said, with 57% of landlords renting property there having reported an increase over the same period, compared with 2% who registered a fall in demand.

The South West of England also recorded a significant increase in tenant demand, with 53% of private landlords there reporting an increase and 13% noting a fall.

Overall, across England and Wales, 31% of landlords reported tenant demand for properties had increased in the first quarter of 2021.

Ben Beadle, chief executive of the NRLA, said: “The pandemic has seen a significant shift in where tenants want to rent, with the trend towards home working making inner cities, especially London, far less desirable.

“This poses significant challenges in determining where to invest to meet demand.

“Investors will no doubt be waiting for the market to settle, and the full road map out of lockdown to be realised, before making major decisions about where to invest.

“This will be particularly important as employers make decisions in the coming months about future working patterns.”