Competition for prime London rental property has reduced the vacancy lag to just 5 days – giving landlords the upper hand. With the lure of rent growth and eager tenants, rental property investment is back on the rise and fueling activity in the residential market. See the following article from Property Wire for more on this.
Tenants are losing out on prime property by failing to move in time with the fast paced London rental market, according to property consultants.
Record demand and restricted supply have meant that the average time on the market for a typical rental property is down to five days, compared to 20 days in August, a report from Cluttons reveals. The firm warns that applicants need to be prepared to pay a holding deposit immediately after a viewing to be sure of securing a property.
The competition for property is so fierce that Cluttons’ Islington office let one property at the asking price within 30 minutes of receiving the instruction. In a similar vein, Cluttons’ Hyde Park office has seen the parent of one foreign student fly into the country specifically to pay one year’s rent up front rather than waiting for an international bank transfer to be sure of securing a particular apartment.
Cluttons is currently experiencing record numbers of tenant applications. Demand is high from applicants across the board as foreign students pour into London, the corporate lets sector remains buoyant and there is strong growth in applications from potential buyers, who currently prefer to rent.
However, this record demand comes at a time of heavily restricted supply, especially as many accidental landlords left the lettings market in the first half of the year. As a result bullish landlords currently hold the cards and the best properties are let in minutes and hours rather than days or weeks, the consultants point out.
A separate reports shows that increasing activity from buy to let investors led a surge in housing market activity in September. The total number of residential property valuations conducted in September was up by a quarter compared to August, driven by largely driven by an increase in buy to let activity, which rose by 59% compared to August, according to the latest research by Connells Survey and Valuation.
However, overall activity fell slightly year on year, with total valuations down by 1% compared to September 2009. ‘Market activity levels will suffer by comparison to the distorted market in late 2009, when buyers rushed to buy properties before the end of the stamp duty. But that doesn’t mean valuation activity is on the wane. We have continued to see slow and steady growth in buyer activity in the last three months. In the third quarter of 2010, activity was actually up 4% compared to 2009,’ said Ross Bowen, managing director of Connells.
The increase in buy to let valuations represented a rise of 79% on last September, albeit from a low base. In September, they accounted for 11% of all valuations, the highest proportion since Connells began compiling its data two years ago.
‘The buy to let market is seeing a mini resurgence. Rising rents and tenant demand have tempted many property investors onto the market despite the recent changes to Capital Gains Tax. And buy to let mortgage finance is showing signs of loosening, allowing more would be landlords to capitalize on strong yields. Buy to let lending was up 12% last quarter on the previous quarter, and 15% on the same times last year,’ added Bowen.
This article has been republished from Property Wire. You can also view this article at Property Wire, an international real estate news site.