Residential Market Update Spring 2023

Lettings Market Update for Landlords

Despite gathering economic challenges, the buoyant lettings market continues. A shortage of decent-quality stock and strong demand has led to upwards pressure on rents which are now well more than pre-pandemic levels. The market continues to defy the wider economic slowdown and increased pressures on household incomes.

There is simply not enough private rental accommodation to support demand in the Capital. The explanations for this are varied; there was a rapid return of people to London as the effects of the pandemic subsided, and these people are tending to be less transient, for example, a change in job circumstances does no longer necessarily entail a requirement to relocate, as many are given the opportunity to work from home.

In addition, it is reported that large numbers of landlords are exiting the private rented sector as a raft of legislative changes and statutory compliance obligations take their toll on an industry the Government has battered. We are busy advising our landlords on how to ensure their properties are compliant and well-managed for the tenants and for the landlords to protect their assets.

This exit of landlords should provide more property for the housing market, but with recent interest rate rises, it remains to be seen how this will play out. We can and do also sell properties for our landlords exiting the rental market.

At Daniel Watney, we are finding a more stable tenant base and a continued high-quality stream of applicants for just a few properties every month. Tenants are prepared to spend more money on where they live, as they spend more time at home than they once did.

We receive dozens of calls from prospective tenants as soon as a property is listed. We regularly exceed asking prices, accepting bids from various suitors. It has been nice to be in the driving seat for so long but we do expect supply and demand to rebalance, as these high levels of rental growth will eventually limit the capacity for further significant increases.

If you are interested in discussing one or more properties that you are looking to let or sell, then, please do not hesitate to contact us.