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The Lowdown on London’s rental market

Foxtons has issued a wide-ranging snapshot of the London private rental market.

Overall some 27 per cent of Londoners are  now privately renting, with Foxtons expecting that to rise to 40 per cent by 2030. The agency itself saw a 57 per cent increase in the number of lettings applicants in 2021 compared with 2020.

After its pandemic dip of 2020, the London rental market, particularly in central London, has rebounded strongly with high levels of rental growth reported at the end of 2021.


Demand remains high and the ratio of new renter registrations to new properties listed was above the three-year average throughout 2021; in Q4 2021 there were 20 renter registrations for every home listed, more than twice the average seen between 2018 and 2020.  

In terms of supply, new instructions continued to fall in Q4 2021, 42 per cent below Q4 2020 levels but just six per cent below Q4 2019 levels.

By the end of 2021 average rents had exceeded the level that they reached before the pandemic across London as a whole and had markedly surpassed in Zone 1.

In terms of locations, it says 10 years ago investors found attractive yields in Hackney and Stoke Newington; fast forward to the end of 2021 and rents and sales price growth in these locations exceed London averages. 

In Hackney, weekly rents have increased by 32.7 per cent compared to 2010 and in Stoke Newington weekly rents have increased by 37.3 per cent compared to 2010.

Croydon and Barking are two boroughs currently with similar apartment prices and rents to those last seen in Hackney and Stoke Newington in 2010. According to Foxtons these areas offer a lower entry-point investment and enjoy above-average gross yields.

On to capital appreciation, and the agency says London house prices have increased 219 per cent over the past 20 years. 


Growth in the London residential market has also outpaced the UK residential market and showed significantly better performance than both the FTSE 100 and gold in the last 10 years.

In qualitative terms, Foxtons believes that increased regulation is providing an impetus for landlords to become more professional and many are choosing to so do with the support of a property management service.

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