The Prime Central London lettings market has seen gradual improvements during the opening two quarters of the year, according to new research released by JLL.
This report indicates that transaction levels increased by 3% in the opening quarter of the year and by another 1% during the second. In turn, this has boosted the annual turnovers to over 9,670 – the highest amount in nearly three years.
Activity Increases
The reported activity recovery has been led from the lower-end of the market, according to the data. Lettings in the below £500 per week market – accounting for nearly 30% of all transactions in the region – were up by 16% in the year to the second quarter of 2017.
On the other hand, the volume of new tenancies agreed in higher price brackets was just 1.9% across the same period.
Despite a slight increase in tenant demand, oversupply of property on the housing market has led to further rental value slips during the second quarter.
Price slips for rentals below £1,000 per week have averaged out at 0.9% during Q2, while the upper-end of the market has seen rents fall roughly 10% in the year to Q2 2017.
PCL rents fall despite increased activity
Subdued
JLL said that subdued turnover during the past two years, coupled with weaker demand and several owners renting out properties having been unable to sell have all contributed to increased levels.
The agency moved to warn that: ‘Furthermore, tenants are bargaining with the choice available to them. The gradual increase in transactions witnessed during the course of the past two quarters will help to lower available supply in the coming quarters, but the very steady increase will take some time to have a meaningful impact.’[1]
[1] https://www.lettingagenttoday.co.uk/breaking-news/2017/8/rents-fall-up-to-10-in-prime-london-despite-increased-activity