London renters are facing a desperate struggle to find places to live after an unprecedented slump in the number of flats and houses on the market.
The number of rental properties available in the capital last month was down 44 per cent on 2021, and 25 per cent below levels seen before the pandemic, according to new data compiled for the Standard.
Numbers are down in all 32 boroughs, and the City of London, with some of the most popular places to live such as Islington, Lambeth, Hackney and Camden seeing disastrous falls of more than 50 per cent compared with last year.
Experts say a double whammy of landlords pulling out of the market because of tax and regulatory changes, combined with a back-log of young workers returning to live in the capital after the pandemic has created a perfect storm in the rental market.
The figures from analysts TwentyCI shows that just 74,766 residential properties were available for letting in London in March, compared with 132,964 in the same month last year, and an average of 100,274 between 2018 and 2020.
The biggest fall was in Islington where they were down 58 per cent year on year to 2,509, followed by the City, down 54 per cent to 375, and Lambeth, 53 per cent lower at 2,834. The smallest fall was in Bexley, where there were just 633 properties available to rent, down 10 per cent.
The shortfall has sent rents spiralling to record levels with double digit increases being pushed through to tenants, worsening the cost of living squeeze.
It represents a dramatic turnaround since the pandemic lockdowns when many landlords struggled to find tenants as thousands lost their jobs or went on furlough and returned to live with their parents, or moved back to their country of origin.
Dan Wilson Craw, deputy director of campaign group Generation Rent, said: “The rush of people returning to London since summer 2021 has seen homes to rent gobbled up as soon as they list. Most renters already in London are avoiding moving if they can help it because rents are so much more expensive now.
“It’s bad news for people who have to move because of changed circumstances or an eviction notice, and cannot compete with people who are choosing to move and can afford to pay more. The government has to do more to get more social housing built in London and raise Local Housing Allowance so renters on benefits aren’t excluded from the market.”
Lucian Cook, director of residential research at agents Savills, said: “London’s rental market has never before seen such dramatic swings in the balance between supply and demand.
“In 2020 we saw demand from key buyer groups dry up and unlet stock build up dramatically, as stock previously on the short-term rental market also hit the books of lettings agents. But the extent and speed at which this has gone into reverse has taken all of us by surprise...Tenants are regularly finding themselves in a competitive bidding environment and having to look across multiple locations in order to secure a rental.”
Seperate figures from property portal Rightmove showed that the length of time taken to find a tenant has fallen from 36 days to 17 days over the past year.
It had 68 per cent fewer available rental properties in February compared with 2021 and 42 per cent down on pre-pandemic 2020.
However, the number of new rental listings has not fallen so dramatically, down by 35 per cent on 2021 and 15 per cent on 2020 suggesting that they are being snapped up much more quickly leaving fewer available on the market.
Savills said that rents are up 11 per cent in prime locations, the first double digit growth since 2010. Rival agents Knight Frank said they had seen even faster growth with rents up 23.3 per cent in central London and 19 per cent in outer London. Meanwhile, the number of new prospective tenants registering in February was 49 per cent above the five-year average.
Gary Hall, head of lettings at Knight Frank, said: “There are some localised examples of the balance tipping back in favour of tenants as supply picks up but the general picture is still fairly imbalanced, which should keep upwards pressure on rental values for a while yet.”
