London Property Rent Market Now Offers Higher Returns

More London property owners might want to consider putting their property up for rent, as London property lease returns today seem to be improving, due to the ever-growing number of folks seeking property to rent in the funds. In recent months, there has been a remarkable shift in demand and supply for land to rent, with the availability of excellent quality rental properties in London falling.

chirii la londra , a booming cosmopolitan town, has long been a favorite spot to lease property.

More tenants are currently negotiating extensions to their current rent contracts, due to a relative lack of other properties to rent, according to various London Estate Agents, including Foxtons, a business which boasts a high renewal rate.

ARLA research, conducted across UK landlords and letting agents revealed that the source of land to rent has fallen, while rental demand has increased, partly because fewer people are purchasing property. Ian Potter, operations manager at ARLA, said: “Many people now in a position to purchase are fighting to find the appropriate property, as there is also a lack of properties for sale and realistic mortgages.”

In the last quarter of last year, an average 41% of ARLA members surveyed reported much more renters than land available to lease.

It really disturbs me as to where all this property has gone!

“In reality, more people are just sitting on the fence right now and are choosing to not rent out their land as they wait to see what happens from the sales property market.”

The development in tenant demand also comes at a time when the supply of new build residential property coming on the leasing market is decreasing. The National Housing Federation report that the amount of new houses built in England and Wales is expected to fall this year for the lowest level since 1923.

Home developers are on course to build under 123,000 homes between April 2009 and March 2010, 18,000 fewer than were constructed during the past financial year, because of the fact that most home builders cut back developments in light of the recession. This season will see the smallest total of new property because 19234, when just 86,000 homes were constructed, excluding the war years.

“As demand exceeds supply we are faced with a new challenge - the best way to provide enough top notch rental properties to meet this requirement,” Potter added.

The decline in the London property rent market coupled with a rise in demand for land to lease is in turn causing a fall in lease void periods and an increase in rental rates and yields across a lot of London - an appealing proposal for rental real estate investors.

As January, Foxtons, by way of instance, have experienced 20 percent more applicants for rented property than this time last year.