London may be experiencing a slowdown in property price growth towards the end of 2014, but according to Strutt and Parker, rental demand for 3 bed homes is outstripping supply.
Even if the property market is taking a breather in London, demand for property continues to be strong, particularly in prime central London according to the latest news from Strutt & Parker.
3 bedroom homes, in particular, are attracting more interest than they have done in the past. This will be good news for investors who will have snapped up 3 bedroom properties in prime central London – which includes areas such as Kensington – prior to the big increase in prices seen in the past few years.
Buy to let investors can now look forward to profiting from an almost inevitable rise in rents as demand outstrips supply.
Head of London Lettings at Strutt & Parker, Zoe Rose commented “The demand for three-bedroom homes for rent in central London is seemingly insatiable. As soon as we get a good one on our books, it lets in a flash.
We recently let a three-bedroom lateral top floor apartment on Cranley Gardens in South Kensington for £1,300 per week within two days on its first viewing – and similarly we let a three-bedroom apartment on Ladbroke Gardens within one week for its asking price of £1,500 per week.”
Part of the for increased demand according to London estate agents are the changing needs of people who are looking for rental properties in the more expensive areas of London.
As prices have risen beyond the affordability of all but wealthy domestic and foreign investors, more people are considering the option of renting rather than buying in prime areas of London. This includes families and people who may require an additional room to use as office space.
As a result 3 bedroom properties have now replaced smaller ones as the most in demand property type. The phenomenon isn’t unique to London with Rightmove revealing that more than a third of its most-viewed homes were three bedroom properties.
Strutt & Parker’s figures for lettings transactions in Q3 2014 show that people are more than prepared to pay more for the type of property they want even if it means paying several thousand pounds a week.
Compared to the same period last year, transactions are up 18.4% for properties between £2,000-£2,999 per week, 14% for properties between £3,000-£3,999 per week and 16.7% for properties over £4,000 per week.
Posted on: October 24, 2014