Rents in some parts of London are starting to fall as supply outstrips demand, according to figures from a property asset manager.
Rents achieved in parts of London, notably, Battersea and including Nine Elms (SE11, SW11, SW8) have fallen by 2.8 per cent as supply outweighs demand, research by London Central Portfolio found.
The London property market south of the River Thames is beginning to suffer as large numbers of the planned 22,000 units between Battersea and Nine Elms have come to market, and are typically purchased by foreign buyers as rental investments.
Data analysed by London Central Portfolio found a significant annual increase in available rental properties in this area of about 28.1 per cent.
This has been accompanied by a 6 per cent discount on asking rents over the last three months. The number of properties actually let has dropped 14.8 per cent over the same period.
Naomi Heaton, chief executive of LCP, said: “In much the same way as we see in the sales market, there is increasing fragmentation in the lettings market, according to property type (new build or traditional stock) and by price point.
"Alongside the oversupply of rental stock in new build heartlands, the uncertain economic outlook has resulted in tighter tenant budgets."
Reports published last week, based on HomeLet statistics, highlighted a slowdown in London rents, reflecting the first annual fall in values (1.2 per cent) since 2009. While this has been generally attributed to the Brexit-effect, figures analysed by London Central Portfolio indicate a more nuanced picture for the lettings market.
The picture has been far more positive in prime Central London where there is limited new build potential. Rents here have increased 1.5 per cent over the last three months.
