London's rental market experienced a continued supply shortage over the summer, leading to increased competition among tenants. New listings across prime central London (PCL) and prime outer London (POL) were 10% below the five-year average in the three months to August, according to Rightmove data.
Knight Frank noted that new listings have not exceeded their five-year average since April 2021, linking this to tax and regulatory changes affecting landlords, including the Renters’ Rights Act which came into force in May.
Tenant competition was particularly strong in outer London, with 8.7 new prospective tenants for every new listing in POL during August, marking a five-year high. This compares to 5.2 prospective tenants per listing in PCL. Average rents in POL rose by 3% in the year to August, while PCL saw a 1.2% increase.
However, the upper end of the market saw stronger availability, with new London listings priced above £1,000 per week being 13% higher than their five-year average. The super-prime market, for properties above £5,000 per week, also remained strong, with some prospective buyers opting to rent due to a weaker sales market.