Data released today from Foxtons, London’s largest lettings and sales agent, reveals applicant demand increased 9% from February, yet demand fell 14% year on year as the market followed more typical trends than in 2023.
Overall, the market continued to follow more usual trends compared to the previous two years. South London displayed the highest applicant demand of any region in London, with nearly 17,000 applicants, which was 18% higher than Central London, the next most in-demand region.
As applicant demand fell year on year, the number of new renters per new instruction decreased in a similar fashion. On average, there were three fewer renters per instruction across London, with the figure sitting at 14 applicants per instruction in March. Compared to February, March experienced a slight increase in new renters per new instruction. East London saw the highest increase of 23%, with 15 new renters per new instruction.
Budgets remained higher than in previous years, with a 3% increase in 2024 compared to 2023. As demand increased from February to March, budgets rose marginally in line with this. Central London continued to command the highest budgets, with an average of £579, which is a 2% increase year on year compared to 2023.
Following the same trend from 2023, there was an increase in new instructions to the market in January and February 2024 which cooled in March, with only a 2% year-on-year increase.
Despite the moderation in March, the increase in January and February 2024 has resulted in a 15% year-to-date increase in new instructions compared to the first quarter of 2023.
Average rent achieved appeared to follow a similar trend to 2023, with a marginal 1% decrease year on year.
From a regional perspective, there was slightly more variation across the different regions. North and West London increased 3% and 5% respectively, but Central London fell 5%.
Gareth Atkins, Managing Director of Lettings at Foxtons, said, “Inflation has dipped to its lowest point in two and a half years, with interest rates expected to follow. This should give buy-to-let landlords the green light going into Q2.
“Furthermore, sales stock is now at its highest in eight years, increasing competition among sellers, which could give pause to landlords who were tempted to sell. Going into the Q2 market, we should see London’s companies begin recruiting drives and lettings activity pick up prior to the busy period in summer. However, average rent prices are expected to remain broadly flat in response to affordability pressures, which would enable more renters to secure their homes in the Capital”
Richard Merrett, Managing Director of Alexander Hall: London’s Leading Mortgage Broker, added, “With the Base Rate remaining stable and with considerably less volatility across Q1, we have seen some positive moves in the mortgage market.
“The two largest buy-to-let lenders have dropped rates, Coventry and Skipton have improved affordability assessments and one of the largest mutuals has launched a Limited Company BTL proposition.”
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