London resi rents remain in decline
Although Covid-19 restrictions began to ease in Q3, the rental market in the capital still struggled to recover, with the average London room rent down 7 per cent, from GBP780 in Q3 2019 to GBP725 in Q3 2020.
Rents in EC3/Aldgate (-34 per cent), W9/Maida Vale/Paddington (-20) per cent and SW1/Westminster/Belgravia/Pimlico (-17 per cent) saw the biggest falls in London, decreasing dramatically from GBP1,244, GBP983 and GBP1,108 to GBP824, GBP788 and GBP922 respectively year-on-year. In fact, the only London postcode district that didn’t see a drop is SE, with rents sitting at GBP713.
Taking a closer look at the capital’s postcodes, there were also dramatic rent decreases in W10 (North Kensington), NW8 (St John’s Wood) and W8 (Holland Park), all down by 16 per cent from GBP932, GBP944 and GBP1,132 to GBP785, GBP797 and GBP956 respectively. NW1 (Camden) saw rents drop from GBP1,011 to GBP860 (-15 per cent), with SW6 (Fulham) down 14 per cent (GBP939 to GBP807) and SW8 (South Lambeth) down 13 per cent (GBP856 to GBP744).
Although London fared worse than other English cities, Edinburgh saw the biggest rent drop out of the UK’s 50 largest towns and cities, with rents down 10 per cent between Q3 2019 and Q3 2020. This decline played a role in making Scotland the only other UK region to experience an average drop in rents (down 2 per cent YOY, from GBP490 in 2019 to GBP481 in 2020).
Of the UK’s 50 largest towns and cities, here are the places which saw the most dramatic declines:
Edinburgh (down 10 per cent)
London (down 7 per cent)
Telford, Glasgow, Gloucester, Ipswich (all down 2 per cent)
Birmingham, Reading, Aberdeen, Stoke-on-Trent (all down 1 per cent)
The data is the latest to be compiled as part of SpareRoom’s Quarterly Rental Index: a comprehensive overview of how the rental market is performing across the country, based on over 500,000 room listings.
Matt Hutchinson, SpareRoom Director, says: “Once again, London dominates the headlines in terms of falling rents, and it’s generally the most expensive neighbourhoods that are worst affected. With so many young renters leaving the Capital, either to find cheaper rents, to move with family, or to leave the UK altogether, it's hard to know when, or even if, London will regain the appeal it had before the pandemic.
"What we’re seeing might just be a temporary shift in the rental market, or it may be the start of the UK’s rental map being redrawn permanently. Even if young renters do return to the Capital in their previous numbers, affordability will be their absolute top priority, in a city that already had an affordability crisis coming into this.”