Changes to taxation and greater flexibility from landlords means activity in the super prime rental market across the Home Counties is buoyant, according to the latest Knight Frank report.
One beneficiary of last year’s changes to stamp duty has been the luxury letting sector, with both supply and demand having increased as higher purchase costs at the top-end of the sales market make buyers increasingly price sensitive.
Knight Frank's analysis of the super prime market across the Home Counties shows that there has been a 13% increase in tenants registering with a budget of £15,000-plus per calendar month in the six months to May compared to the previous six months, which partly explains why the volume of viewings conducted by the company at this level has doubled in the same time period.
Jemma Scott, partner in Knight Frank Home Counties, said: “Importantly, demand for super prime rentals remains strong with a good level of applicants and viewings. Increasingly, tenants are renting in order to ‘try before they buy’, illustrated by an increase in tenancy agreements that include an option to purchase.
“This allows families to settle in the area before committing to a full time move. Established international schools, open spaces and excellent transport connections act as a pull to UK and international tenants.”
With more rentals being agreed at this level, there was a 21% reduction in the number of super prime properties available at the end of May, comparative to same point of 2016.
Gordon Hood, partner and head of Ascot Lettings, said: “Previously the Home Counties super prime rental market has seen good supply and therefore a reduction in rents. However, it is inevitable when a market sees continued demand but with less available stock that you would expect an increase in price, so this will be one area of the market to watch during the remainder of 2017.
“There is certainly demand from applicants and the challenge is now finding the correct stock for them.”