Outer London’s landlords report a surge in demand

The proportion of landlords operating in Outer London who have reported increasing demand from tenants has surged since the previous quarter, Paragon Bank reports.

The bank says that it has carried out research that reveals in the first quarter of 2022, 79% of landlords who let homes in Outer London indicated that they had seen an increase in demand from tenants during the previous three months.

And the most recent survey covering the second quarter has revealed that this figure has grown to 85%, making Outer London the region with the highest net increase in tenant demand.

‘The private rental market in London was hit particularly hard by Covid’

Richard Rowntree, the mortgages managing director for Paragon Bank, said: “We know that the private rental market in London was hit particularly hard by the Covid pandemic but has rebounded strongly since and these latest figures provide further evidence of this.

“As one of the world’s greatest cities, London is extremely dynamic, constantly evolving as a diverse mix of people come and go, calling it home as they study, work, travel or raise families.

“This is why it is important for the capital to have a thriving PRS, enabling people to benefit from the flexibility that rented homes provide.”

Changes in tenant demand during the previous three months

In addition to analysing changes in tenant demand during the previous three months, the survey also provides insight on current demand, another metric that illustrates the strong performance of the Outer London private rental market since the first quarter of the year.

Despite the South West being the region with the highest proportion of landlords (90%) reporting ‘strong’ demand currently, the biggest increase on this year’s first quarter was seen in the proportion of those managing properties in the capital’s outer boroughs, rising from 72% to 85% in the second quarter.

Linked to this and another indicator of demand for rented property in Outer London, the survey of more than 700 landlords found that the incidence of voids has fallen dramatically since the same period a year ago.

In the second quarter of 2021, 35% of Outer London landlords said that they had experienced an empty property within the last three months – the second highest region behind the North East.

Void periods are also falling

A year on, the second quarter figures for 2022 have seen this figure for voids fall to 21%, with only landlords in the West Midlands less likely to have reported a void period.

The findings form part of Paragon’s Private Rented Sector (PRS) Trends report which offers insight into a range of useful metrics including tenant demand, landlord profitability, yields generated and future investment plans.

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