The rate at which room rents are increasing across London continued to slow during the second quarter of the year, despite high demand from tenants, according to a report by SpareRoom.co.uk.
Data provided by the flatsharing website reveals that the annual rate of growth in room rents in the capital has slowed to just 1%, taking the average price of renting a room in the city to £734 a month.
Around a third of London’s postcode districts have seen an annual drop in room rents, with prices falling 4% in north-west and 2% in west-central and east-central London.
“It seems many areas of London are at rental saturation - people simply can't afford to pay higher rents so they're stabilising,” said Matt Hutchinson, director of SpareRoom.co.uk.
With overall demand from tenants continuing to outstrip the supply of rental properties in the capital, Mitchell expects to see room rental rates increase further, led by gains in areas in Zone 2 with really good transport links. But for now, London is among the towns and cities in the UK seeing the lowest rate of room rental growth, along with Belfast and West Bromwich which both also recorded 1% year-on-year growth.
Room rental prices outside of the capital are increasing fastest in Swansea, where gains of 12% have been recorded over the past 12 months. This was followed by Bradford (11%), Portsmouth (11%) and Swindon (11%).