How to navigate the frenzied lettings market...

Queues to view flats, soaring rental prices, multiple offers, long contract commitments with no break clauses, difficulties arranging viewings, properties letting before they even hit the property portals…..just some of the nightmares facing prospective tenants today. In my nine years of working as a property finder in London, I’ve never seen the lettings market so competitive. Last week, I put in an offer for a client for a one bed rental in Highgate and found that there were 13 other offers submitted on the same day. The very same week, I went to a block viewing of a garden flat rental in Clapham and there were 23 people viewing the flat within only a two hour time slot. These issues aren’t limited to the super high profile locations; they are all over London.

Why is the London lettings market currently so tough?

There is a surge of people coming back to London – employees returning to the office; students getting back to education and professionals relocating post Covid. In August, the number of new prospective tenants registering in London was 75% higher than the five-year average, but yet the new rental supply was a third less.*1 The private landlord sector is shrinking. Recent research showed that between 2019 to 2022, 94% of landlords who removed their property from the rental market did so to sell it.*2 This is because there are now less favourable tax breaks for private landlords - all admin/reference/check in/check out fees are paid by landlords compared to previously all fees were split between landlord and tenant, and landlords are no longer able to deduct their mortgage costs from their rental income to reduce the tax that they pay. Upcoming energy efficiency targets due next year could force landlords to achieve minimum EPC ratings of C, which, whilst important, couldn’t really come at a worse time and are scaring landlords even further. The combination of mass tenant demand and limited housing supply isn’t a good combination.

So what can you do to secure a good property in this frenzied lettings market?

The two most important things are to be quick and be decisive. Get to properties as soon as they come available! Narrow your focus to 2 or 3 locations. Speak to the estate agents in those areas daily to find out what new properties are coming available. You ideally want to be seeing the properties or knowing about the properties before they even go on the online sites and ideally before any ‘open events’ occur. (where all prospective tenants are shown into the property in one go, which can lead to infamous bidding wars occurring!) Agents are often restricting viewings to the first 10-20 people due to the volume of interest, so you need to aim to be one of the first in. Also start looking as far in advance as you can. Tenants usually have to give 2 months notice to leave a property, so more options are now becoming available later.

You need to be decisive. Today I saw two properties in Wembley in the morning, by the afternoon both had gone under offer. If you like a property, then it’s worth offering immediately after the viewing. Email over all the offer details at the start - price, start date, length of tenancy, what furnishings are included, asking for professional clean and provide a full profile on you. (Your job title, salary, length of time with company, permanent contract etc.) Landlords will sometimes take a lower offer from someone that they feel will be a good reliable tenant, so the more information on you the better! Up-front payments of 3-6 months and long time contracts can also help make your offer more attractive. And if your bid is accepted, pay the one week holding deposit quickly. Any delay could suggest that you’re waiting for another property or having issues paying, and you risk your agent moving onto someone else.

If you want to make your life a bit easier, you could use the services of a home finding expert, who will do the hard part of ringing around to book in those elusive appointments for you and will have estate agent contacts to help get you on that viewing list, as well as to find options not yet advertised online. Home finders can also advise on locations or areas that you may not have thought of before, and help advise you on price, length of contract and other contract terms. Accompanied home finding days allow you to visit all the best options in one busy - sometimes tiring - but always productive day, or they can set up additional viewings after your day to try to get you first in to see properties as soon as they become available to view. After all, who really wants to be spending their precious evenings scrolling through the out-of-date property listing sites?

*1Knight Frank The Intelligence Lab. London and Home Counties. PCL rental index

*2 Property Mark.