Annual London rent growth slows in June

 
Annual London rent growth slows in June

Both tenants and landlords are experiencing real positives at the current time in the London private rented sector, after it was revealed this week that rental prices are very strong, but rising slower than they were a year ago. 

What this means for landlords is that the price of renting property remains high and continues to grow. This can only be a positive for them, as the rental yields they are able to bring in remain high.

Landlords experienced the 12th consecutive month of rental price increases in June, according to the latest release from Knight Frank, which shows just how strong the market is and how it has real potential to be a strong investment option for a very long time. 

For tenants, the fact that prices climbed by 3.4 per cent on an annual basis in June, which is slower than it has been for some time, represents a reality in which prices are starting to level off, even if only slightly. 

While constant rises are a positive for owners, tenants will eventually reach an affordability barrier, and so a slowing of increasing prices is a positive that will bring a degree of stability for tenants at the current time. 

Knight Frank believes that one reason for the slowing of price rises in June has been a sharp rise in the number of available properties in the sector since the general election. As the Conservatives scored a surprise majority, many investors saw this as being positive for the future prospects of their investment, meaning they added to their portfolios.

This quick influx of stock helps address the supply and demand issues inherent in the market, easing price rises slightly. 

"The health of the prime central London lettings market is linked to that of the UK economy and some perceive it to be on a firmer footing under a majority Conservative government, which has caused stock levels to rise," said Knight Frank's head of London residential research Tom Bill. 

He also added that as the election campaign ended, there was an increase in positivity from those who had thought of selling their homes in the past, who then moved them into the rental sector with the promise of a positive long-term income.