London rental prices hit nearly £1,600 per calendar month

London rental prices hit nearly £1,600 per calendar month

The average price of renting a property in London continued to rise in July as the supply and demand imbalance meant that tenants were having to compete and pay higher prices to get the property they desired. 

According to the latest data released by HomeLet, looking at the rental market for the past month, it was found that the average cost of renting a property in Greater London now stands at some £1,599 per calendar month. HomeLet said this was four per cent higher than had been recorded a year ago. 

But although rental prices are climbing for tenants in the capital, HomeLet also said that the rises are slower than they have been in the past, with the Brexit effect perhaps starting to show a little as price growth stalls ever so slightly.

Martin Totty, chief executive of Barbon Insurance Group, which is the parent company of HomeLet, said: "Population growth will continue to increase demand, and that the housing stock isn’t growing quickly enough to meet that demand. However, with rents ultimately limited to a tenant’s ability to pay, rents are likely to continue to climb, albeit at the slowing pace noted most recently."

"We won’t know exactly how Brexit is impacting the private rental sector and it will be several months yet until we see some clearly established trends in the marketplace. It seems likely that with lenders concerned about the prospect of falling house prices, loans to value in the mortgage market are going to become less generous, which may see more people turn to the rental sector rather than buying a property," he continued. 

It was also reported in the data from HomeLet that London prices remain more than double the average rental cost seen across the rest of the UK. With London excluded, the average price for renting a property nationwide sits at just £779 per calendar month, representing a 2.3 per cent growth year-on-year.