Private landlords in London have been forced to drop rents by up to 15% following a significant increase in the number of empty properties on the market, according to Chestertons.
With fewer corporate relocations and overseas students looking for accommodation, as well as a growing number of people concerned about job security, the letting agency reports that there has been a sharp drop in tenant demand.
Chestertons says that the number of rental properties available in the capital is up by about 63% year-on-year, meaning that tenants have a much wider choice than before.
Richard Davies, Chestertons’ head of lettings, said: “We are now coming into the busiest time of year for rentals in London.
"However, we have seen a rapid switch from a landlords’ market to a tenants’ market and landlords are now having to discount their properties by 10% to 15% in order to secure a tenant, or risk facing a long void period with no rental income.”
Chestertons’ own figures show that although there are a lot of tenants looking at properties – with 52% more enquiries and 25% viewings, many of which are still virtual, than the same time last year.
The number of tenancies being agreed is down 27% as tenants have become increasingly selective and only willing to take a property if they believe it represents good value.
Davies added: “The market is still incredibly busy and there are a lot of excellent tenants out there prepared to move quickly, so this is far from an Armageddon situation, but the way things are currently playing out mean that tenants are generally able to secure a better deal than they currently have and landlords are needing to drop their rents accordingly to ensure their property remains competitively priced.”