The London rental market saw a significant shift in May 2024, with a marked increase in property listings leading to a more balanced environment for renters, landlords, and agents. Foxtons Lettings Market Index reveals key trends shaping the market this spring.
Increased property listings ease competition
The latest data from Foxtons shows a 36% increase in property listings in May compared to April, and a 10% rise year-to-date compared to 2023. This influx of properties has reduced competition, offering renters more choices and lessening the urgency to register with multiple agents. Gareth Atkins, Managing Director of Lettings at Foxtons, remarked, “As we move into peak summer lettings season, supply is growing. Renter demand is also growing, mirroring 2023’s Q2 trends with a 20% month-on-month increase.”
Notably, over 20% of new instructions for the year were in Westminster and Tower Hamlets, with Westminster alone accounting for 11%. This surge in listings has provided a much-needed reprieve for the market, creating a more normalised environment.
Steady applicant demand
Applicant demand saw a seasonal rise of 20% from April, aligning closely with trends observed in Q2 2023. Despite the increase in demand, the greater number of listings has led to a 21% reduction in new renters per instruction. Foxtons anticipates that applicant demand will continue to follow last year’s trends through the summer, resulting in a busy Q3 market. Atkins noted, “If demand follows last year’s trends through summer, Q3 will be a very busy market.”
Impact on rental prices
The increase in property supply has had a slight impact on rental prices. The average rent in May 2024 was £577 per week, slightly below the £606 average in May 2023. Year-to-date, there has been a marginal 2% decrease in rent compared to 2023. This adjustment reflects the reduced competition for properties, giving renters more leverage in the market.
Additionally, Foxtons reported a 5% month-on-month increase in new instructions in May, with East London experiencing a 26% rise. These figures highlight the dynamic nature of the current rental market and the varying trends across different regions of London.
The London rental market is experiencing a more balanced phase with increased property listings and steady demand. This shift provides a welcome relief for renters, landlords, and agents, facilitating a healthier and more competitive environment. As the market enters peak summer lettings season, the continued growth in supply and demand is expected to maintain this equilibrium, offering a promising outlook for the coming months.
