Lack of affordable rental housing seen in London
Tuesday, 12 April 2011 5:02 PM
Estate agent Cluttons has reported a lack of affordable rental housing in London in its Residential Property Forecasts April 2011 study.
According to the agency, a combination of low consumer confidence and little mortgage availability has resulted in more people seeking low-cost rental property in London. Many may also be concerned about the spectre of negative equity, when falling house prices mean a property is worth less than the size of the mortgage secured against it.
As a result, the available rental housing stock in the capital is filling up rapidly, with a particularly extreme shortage of homes in the £250-£400 per week bracket.
While two-fifths of would-be tenants are looking for properties priced below £400 per week, only 15 per cent of available rental properties fall into this category.
Consequently, Cluttons expects average London rents to rise between two and three per cent over the course of 2011.
Cluttons' partner for residential lettings Lynn Hilton said: "Tenants are considerably more cost-conscious than they were even a year ago, as it becomes apparent the economic recovery will be slower than expected."
With more demand than supply, the company added that some would-be tenants are being forced to look elsewhere, driving them out of the city's prime areas.
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