London rents increase for first time in 15 months
The lender said there are signs that demand for rental accommodation could again be rising in the Capital, and that this puts further pressure on the government to follow through on its pledge to release an extra £2bn of cash for local authorities to build more affordable housing.
However, the rise in London was marginal – with rents up 0.01% in September to £1,876, compared with August. Rents are still 0.80% lower in London year-on-year.
In the UK as a whole, the average rent is up 0.73% on last September at £1,196, 0.10% higher than in August. Scotland has seen the biggest increase: 2.01% year-on-year and up 0.42% in the last month to £733. It was followed by Wales, which has seen an annual rental increase of 1.31%.
Landbay also said rental increases along the proposed Crossrail 2 route were premature as a leaked business case from TFL suggested the scheme could be delayed by a decade.
The index showed a significant uplift in tenant demand in the four and a half years since the route was announced that pushed up rents in 13 of the 15 affected local authorities, and by 21.5% around north terminus Broxbourne.
Overall in the four and a half years since the announcement was made, 13 of the 15 affected local authorities have seen notable rent rises, most notably in the North and West extremities of the line, namely: Broxbourne (21.5%), Enfield (13.8%), Haringey (11.4%) and Spelthorne (10.5%). (See image below.)
However, since 2016 rents have once again begun to fall. Only Enfield saw rents grow (0.4%) in the past year, although by September rents had fallen there too. Meanwhile Broxbourne (-1.75%), Richmond (-1.13%), and Spelthorne (-2.16%) are all showing signs of dwindling tenant demand.
John Goodall, chief executive and founder of Landbay, said: “News that the line may now be delayed by a decade is nothing short of a hammer blow to all those who have had the foresight to plan that far ahead.
“What’s needed by tenants, landlords, buyers, business, and builders is a clear commitment from the government that the project will be delivered in 2033 as expected. Not only to help people and businesses plan their lives ahead, but also to allow adequate time for local authorities to plug housing shortfalls before demand spirals out of control.”
Goodall added that the government’s £2bn social housing pledge is an encouraging sign but could and should be linked to the UK’s infrastructure plan.