London rents skyrocket to ‘extraordinary’ levels as tenants stampede

PUBLISHED : Tuesday, 10 March, 2015, 9:48pm
UPDATED : Tuesday, 10 March, 2015, 10:12pm


It may not be very big, but a small one-bedroom flat in central London caused a stampede among tenants and was let in just 40 minutes after the agent got more than 200 email and phone inquiries in the first quarter of an hour.

The 301 square foot flat on Pollen Street, Mayfair was taken by a manager at a five-star hotel nearby, who put down £10,000 (HK$117,000) up front to cover the deposit and six months' rent - even though she had not had a chance to view it.

Rent for the flat, which boasts a separate bedroom but not much space for a television in the narrow living area, is £1,560 a month, but this didn't put off would-be tenants. The letting agent, EJ Harris, said it had received five serious offers within 30 minutes of an advert for the flat going out to customers.

Elizabeth Harris, managing director of EJ Harris, said: "The speed of this deal and the battle to secure the tenancy is the clearest indicator yet to me of how buoyant and hot London's letting market is at present.

"If it was a swanky flat in Mayfair's posh western district, I would expect it to fly out of the door, but this is an ordinary Londoner's apartment on the eastern Soho border by Regent Street. It's the ordinary nature of this that makes it so extraordinary."

Henry Pryor, a buying agent who finds homes for well-off clients, said a growing number of owners were putting their homes up for rent instead of selling them, and would-be buyers were delaying entering the market.

"With uncertainty hanging over the top end of the sales market, many sellers are becoming reluctant landlords rather than take a hit on their asking price, and many buyers are considering the merits of renting," he said.

"Stamp duty for buyers over £1m, fees and costs all make a hasty purchase an expensive mistake and that's before you worry about falling prices."

Pryor said one of his clients was interested in finding a four-bedroom home within an hour of central London with a budget of up to £30,000 a month.

"Despite this eye-watering advantage, there are other tenants to be handed off and competition can be fierce," he added.