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Houses for rent are letting 30 per cent faster than a year ago, pushing rents higher, property portal Zoopla has reported.
But this does not hold good for city centres where changing patterns in working and commuting, leisure and tourism, have eased rental demand, said Zoopla’s latest Quarterly Rental Market Report.
Annual falls in rent of 1.8 per cent in Edinburgh, 0.9 per cent in Greater Manchester and 0.8 per cent in Greater Birmingham were recorded. By contrast, a ‘halo effect’ has emerged in the wider commuter zones around the UK’s largest cities. In these areas rents were rising strongly on the back of increased demand for properties with more space, indoors and outdoors, said Zoopla.
Across the UK as a whole, excluding London, rents were up by 2.3 per cent. But in London, demand was down by 10 per cent and rents were down by 8.3 per cent.
The average London fall was exaggerated by declines in the higher value, more dense rental markets areas such as Kensington & Chelsea – down 12.3 per cent. ‘However, while rents are falling by at least 6 per cent in most inner London boroughs, several outer London boroughs are still showing rental growth’, said Zoopla.
Higher levels of stock availability are expected to characterise the London market over the course of 2021, pending a post-Covid return to international travel, commuting, employment growth and offices opening at scale.
‘Changing working, commuting and tourism patterns were felt very quickly in the central London rental market. Now we are seeing the impact in other city centres, although on a more modest scale’, said Zoopla head of research Grainne Gilmore.
‘Balancing the rental declines in inner cities is the strong rise in rental growth in surrounding ‘halo’ areas and well-connected towns across the UK, reflecting stronger demand in many of these markets among a cohort of renters. Yet it is important to note that most demand among renters living in central cities is within the same area – some renters will have ties to an area through schooling, or non-office based work.
‘The search for space among renters is coming across loud and clear from the data however, with houses in major cities now being rented out more quickly than a year ago. In most cases, flats are now taking longer to rent out.