London is home to approximately 3 million private renters, or 30% of households in the capital, a figure which has risen significantly since the 1990s (2021 census).
The London housing crisis has led to a boom in rent increase and diminishing availability for moderate and low-income households.
But a new report by Zoopla, the property company, suggests that ‘Rental growth has now peaked and we expect a major slowdown in 2024.’
This ‘cool down’ has shown a drop from +17.0% increases a year ago to +9.0% now. In their end-of-year report, the property website forecast only a +2% growth increase in 2024.
However according to London estate agent Benham and Reeves, while London slows down the supply levels will not meet demand any time soon, with individuals paying an average of 35% of their income on rent.
The estate agent continued that while ‘London remains the least affordable region of England for renters’, this ‘current level of income required to cover the cost of renting has fallen from 50% in 2017’.
But as Director of Benham and Reeves, Marc von Grundherr, stated: ‘It certainly won’t feel like the challenge of renting has become any more affordable.’
This is partly due to the supply crisis in London, with the Greater London Authority for Land and Property suggesting that the number of private rental properties in the city has fallen substantially since mid-2020. Rightmove data also indicates that availability has decreased, while an inverse spike in rent prices has only increased.
Source: AP
Many households are moving out of London due to this constant and uncontrolled rent increase. Lucy, 46, moved to West Somerset in the late 2010s. ‘It became completely unaffordable. We had two young kids and wanted to save for them – but at the time we were spending huge amounts of both our salaries on rent. It felt like constantly just bleeding money every month.’
Like many young couples moving out of London, buying a house and paying back a mortgage was far more affordable than London rent. According to UCL data house prices in London doubled between 2009 and 2016, pricing out households on middle to low incomes and thereby driving up rent.
But nearby Lucy in Somerset, Frome Town council has just declared a housing crisis; citing Londoners moving to the charming town as a problem. Rent has risen to £1,499 a month, 50% of the average salary, with households relocating for the direct two-hour commute to London and quaint traditional streets.
Source: AP
While Zoopla forecasts this ‘cool down’ in 2024, Foxton suggests an average of 19 people are still viewing every property. So with Londoners’ rent maintaining its increase, the capital’s crisis is reportedly likely to continue into the new year.
Submitted Article
HeadlineLondon rent crisis could ease in growth in 2024: Zoopla says the Capital may have reached its ‘peak’
Short HeadlineLondon rent crisis could ease in growth in 2024
StandfirstA new report from Zoopla suggests rental growth in the capital will slowdown as price boom has reached a ‘peak’
Published Article
HeadlineLondon rent prices have ‘peaked’ and 2024 slowdown expected, Zoopla report says
Short HeadlineLondon rents 'peaked' and 2024 slowdown expected, report says
StandfirstA new report from Zoopla suggests rental growth in the capital will slowdown as price boom has reached a ‘peak’
London is home to approximately 3 million private renters, or 30% of households in the capital, a figure which has risen significantly since the 1990s (2021 census).
The London housing crisis has led to a boom in rent increase and diminishing availability for moderate and low-income households.
But a new report by Zoopla, the property company, suggests that ‘Rental growth has now peaked and we expect a major slowdown in 2024.’
This ‘cool down’ has shown a drop from +17.0% increases a year ago to +9.0% now. In their end-of-year report, the property website forecast only a +2% growth increase in 2024.
However according to London estate agent Benham and Reeves, while London slows down the supply levels will not meet demand any time soon, with individuals paying an average of 35% of their income on rent.
The estate agent continued that while ‘London remains the least affordable region of England for renters’, this ‘current level of income required to cover the cost of renting has fallen from 50% in 2017’.
But as Director of Benham and Reeves, Marc von Grundherr, stated: ‘It certainly won’t feel like the challenge of renting has become any more affordable.’
This is partly due to the supply crisis in London, with the Greater London Authority for Land and Property suggesting that the number of private rental properties in the city has fallen substantially since mid-2020. Rightmove data also indicates that availability has decreased, while an inverse spike in rent prices has only increased.
Source: AP
Many households are moving out of London due to this constant and uncontrolled rent increase. Lucy, 46, moved to West Somerset in the late 2010s. ‘It became completely unaffordable. We had two young kids and wanted to save for them – but at the time we were spending huge amounts of both our salaries on rent. It felt like constantly just bleeding money every month.’
Like many young couples moving out of London, buying a house and paying back a mortgage was far more affordable than London rent. According to UCL data house prices in London doubled between 2009 and 2016, pricing out households on middle to low incomes and thereby driving up rent.
But nearby Lucy in Somerset, Frome Town council has just declared a housing crisis; citing Londoners moving to the charming town as a problem. Rent has risen to £1,499 a month, 50% of the average salary, with households relocating for the direct two-hour commute to London and quaint traditional streets.
Source: AP
While Zoopla forecasts this ‘cool down’ in 2024, Foxton suggests an average of 19 people are still viewing every property. So with Londoners’ rent maintaining its increase, the capital’s crisis is reportedly likely to continue into the new year.
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