This is a 4% increase from September, which would typically be the peak of the rental market. Central London continued to produce the highest average weekly rent this year at £643 per week, a 29% increase on prices seen in October 2021.
There were 22 tenants competing for each new property in October 2022, which is more than any October Foxtons has recorded in 2021, 2020, or 2019. While the number of tenants competing has declined since September, the 22 tenants in October by new instruction are 40%. higher year after year.
In October, demand for properties in London followed the usual downward seasonal trend, with a 38% reduction in tenant listings from September 2022 to October 2022. However, compared to October 2021, tenant listings are still 2% higher. With intense competition in the capital, tenants have turned their attention to outlying areas. In South London, listings are up 37% from 2021, and in West London, listings are up 57% from 2021.
Candidates’ weekly budgets remained much higher than they usually do in October. The average weekly tenant budget in October 2022 was £485, more than £20 more than the average budget in October 2021. Year-to-date budgets are 7% higher than in 2021.
For the second month in a row in 2022, Foxtons saw renters spending more than their budget to secure a property. In October 2022, tenants spent 101% of their recorded budget, an increase of 3% compared to October 2021.
Gareth Atkins, Managing Director – Rentals, said: “Across our offices and within our renewal team, October proved to be a very busy month. Competition for rentals in London is intense.
“Average rental prices have hit a new record high at £571 per week, and we’re seeing a return of tenants spending above their recorded budget at 101% on average (a number we haven’t seen since before the pandemic).One reason for competition is rising interest rates as tenants who were considering homeownership are now looking to renew or find their next rental.Another reason is lack of supply.
“October saw the lowest monthly volume of new listings since the start of the year. With the rapid expansion of government regulations and the biggest increase in interest rates the UK has seen in years, the owners have a lot more to consider in their business plans going forward, we will likely see these unusual trends continue into the fourth quarter.”
Sarah Tonkinson, Managing Director – Institutional PRS and Build to Rent, said: “The rental market generally follows a set pattern with August and September being the busiest months of the year, followed by a quiet fourth quarter. However, average rental prices of £571 in October actually exceeded the September record, which is a huge deviation from the normal trend.
“As a rule, Londoners don’t want to move over the holidays, and we often help negotiate different tenancy periods between landlords and tenants, such as 15 months instead of 12, to avoid properties hitting the market. market at this time of year. Instead, there were 22 applicants per new listing last month, which is higher competition in October than we saw even before the pandemic in 2019 .
“We have mentioned in previous rental market reports that this could be an exceptionally busy fourth quarter, and so far that is proving absolutely true.”