Spring Brings Tenant Demand

Our latest data confirms a strong start to spring’s lettings market with 10% more tenants signing a tenancy agreement in March compared to February. We also saw 11% fewer tenants withdrawing their offer, further suggesting that the majority of renters are motivated to finalise their search as soon as possible. The new data comes following our February rental market review, which, at the time, revealed an increasing number of London landlords choosing to reduce their asking rent in reaction to shifting market conditions.

Adam Jennings, Chestertons’ Head of Lettings, says: “Not only did February’s rent reductions fuel new tenant demand throughout March, it also boosted the number of tenants renewing their existing tenancy agreement (+4%) as they were in a stronger position to negotiate any planned rent increases and settle at a more favourable level.

“However, as we head further into spring, demand for rental properties will only grow which will see rents going up again if supply doesn’t follow suit. In March, we already saw a 1.5% decrease in the number of available rental properties compared to the previous month. Due to this and the uplift in tenants wanting to move, we are beginning to see fewer landlords who are willing to accept a rent reduction compared to February. Having said that, any rent increases are likely to be subtle”, Jennings explains.

Confirming this forecast is Zoopla’s latest Rental Market Report, published in March, which states that London has recorded a sharp slowdown in annual rental inflation, with rents now rising at a rate of 5.1% compared to 15.3% a year ago. The average rent in the capital currently stands at £2,121.