London sees increase in “super prime” tenancies

London sees increase in “super prime” tenancies

More people are renting “super prime” properties within the capital, according to a new report.

Data shows a total of 137 homes in London were rented out at over £5,000 per week in 2017 - an increase of 34 per cent on 2016 levels.

The LonRes report, produced by Knight Frank, also revealed during the three months from July to September a record number of 49 properties were rented out - the highest number in a quarter for more than a decade.

Tom Smith, Knight Frank’s head of super prime lettings, explained there has been a number of factors which have encouraged people to move away from buying and opt for renting instead. In addition, more homeowners are looking to become landlords rather than sell up.

“Demand is resilient due to higher rates of stamp duty and the associated uncertainty over the short-term prospects for price growth in the sales market. A lack of clarity regarding Brexit has also been a factor,” said Mr Smith.

Data also showed the super prime letting market is seeing long-term tenancies being arranged, with the average length in 2017 standing at 589 days, compared to 548 in 2016 and 528 in 2015.

In addition, the research found there has been a rise in the number of tenants adding a contract clause allowing them to be given first refusal to buy at the end of the tenancy.

“Many landlords have nothing to lose with this try before you buy route,” explained Mr Smith.