"It remains a tenants' market, particularly in higher price brackets, with landlords having to be flexible with regards to asking rents in order to remain competitive and keep void periods to a minimum"
The marginal decline over the course of the year came as stock levels at the top end of the market continued to edge upwards, a trend which has been fuelled by greater uncertainty in the sales market following a series of tax changes. Accordingly, Knight Frank was instructed to let 39% more properties in Q4 2016 compared with the previous year, and the number of market appraisals – a good indicator of future stock levels – was up by 45% over the same period.
As a result it remains a tenants' market, particularly in higher price brackets, with landlords having to be flexible with regards to asking rents in order to remain competitive and keep void periods to a minimum. Meanwhile, activity levels picked up towards the end of the year. The number of tenancies agreed between October and December was 12% higher than the same period of 2015, and 16% higher than during the previous quarter.
The number of viewings rose 17% over the same time compared with 2015, while the volume of new prospective tenants increased by 28%. Agents note that much of this demand was focused on the sub-£4,000 per month price bracket with such properties often letting faster than those in higher price brackets.
This section of the market was also boosted by an increase in corporate enquiries from company executives moving to the Home Counties for work over the course of the quarter. Accordingly, some 77% of corporate enquiries in December, for example, had budgets of between £1,000 and £4,000 per month.
