Investors Review

Spring Lettings Market Hots Up

Anita Mehra, Managing Director of Benham and Reeves Residential Lettings comments on the London rental market.

As we come to the end of the first quarter of 2008 and, as spring seems finally to have sprung, the lettings market also seems to be hotting up.

Here at Benham and Reeves Lettings we’re finding that property is taking an average of 10 days to let and we have good demand from tenants ready and waiting for property throughout London.

The credit crunch doesn’t seem to have had a major impact on the lettings market, although long term there could be redundancies in the financial sector which may have an effect later on.

At the moment, it doesn’t matter if it’s small, large, new or a conversion – we need all types of property to meet demand. I’d be surprised if many landlords are seriously considering selling their investment property the way the rental market is. All our landlords are delighted - yields are up and property is letting, mostly before the previous tenant has even left.

Perhaps one of the reasons for the somewhat frantic activity in the rental market is that house buying has moved out of reach of the younger generations, as prices spiralled out of control over the past few years. This was confirmed by the latest Personal Credit Index research published by CreditExpert.co.uk, which reported that 48% of residential tenants believe that they will continue to rent, and see no prospect of being able to get on the housing ladder.

Perhaps the love affair between the Englishman and his ‘castle’ is well and truly over and, rather than follow our habitual inclination to buy, we are set to become a nation of renters instead. This sea change in how we live is less unexpected when you consider that the proportion of the family budget spent on accommodation has jumped from 9% in the 1950s to 25%. Add to that the problems of student debt, and the imponderables of getting together the deposit when buying a home, and renting is looking a lot more appealing - particularly for newly weds and singles.

Despite all the activity in the lettings market it doesn’t mean that landlords can be slapdash when it comes to presentation of their properties and, now more than ever as tenants start to call the shots, it’s important to have them in tip top condition.

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