During this time, it is no secret that it is difficult to rent a house in London
Recently, Helen Crane shared her story of renting a home in London.
【The bathroom is less than 2 meters high, but there are 17 people competing】
Helen Crane is an editor who lives in London with her boyfriend.
After the epidemic, Helen and her boyfriend chose to stay in London because they could not stand long-distance commutes, but in order to facilitate their work from home, the two decided to rent a larger house in south London.
At first, Helen and her boyfriend visited a one-bedroom apartment in Tooting.
Helen thought to herself, if it is really like what her friends said, then will there be more properties she can choose?! Maybe through bargaining, the same rent can also be selected for a better property.
However, after a period of looking for a house, Helen found that he thought too much, and renting a house not only did not become easier, but became more and more difficult!
The house is a nice unit, but the size is smaller than Helen expected, and the ceiling of the bathroom is low, and Helen's boyfriend is 1.9 meters tall and can't stand up at all inside.
Helen thinks that this house is average, and the rent is not cheap, which is really not cost-effective.
But the agent told them that on the night they left, 17 other people visited the house, and some people expressed interest in the property on the spot.
This shocked Helen greatly, but soon, something that shocked her even more appeared
After visiting the house, Helen did not take a fancy to the property, because the property was in general condition, the wallpaper in some places was peeled off, the bathroom looked damp, and the smell in the house was not good.
But it is such a very ordinary house, and there are not many people bidding for rent.
Shortly after the visit, Helen received an email from the agent telling them that they only had two hours to decide whether to make an offer.
The agent also said that because of the large number of people who quoted, they estimated a "suitable" price for Helen, which was much higher than the landlord's "asking price".
In desperation, Helen once again began to look at the house...
What broke Helen's head, though, was that she had to remove about half of her favorite properties from the list of houses because they were snapped up before they could contact the landlord.
Tired and irritated after countless visits, Helen had to give up on her original plan to rent an apartment with a garden to find a relatively satisfactory house, but it was far from her expectations.
Later, Helen also asked many professionals why it was difficult for him to find a satisfactory apartment.
Everyone's answer is basically, you are looking for a room too late!
Helen said many people told her that since last summer, the UK has gradually unblocked, and many young people, international students, and overseas people have returned to London, which has made the demand for rental apartments "unusually high", which has also created widespread competition among tenants and made it more and more difficult to rent.
【The growing "rental dilemma"】
In fact, Helen's situation is not unique, since last summer, tenants in many cities in the UK have fallen into a "rental dilemma", even london!
With the passage of time, the situation of rental housing difficulties has not only not eased, but has become more and more intense...
Regarding the current market situation, James Evans, an expert at Douglas & Gordon, said a large number of renters had returned to London in the first few weeks of 2022.
James also said that the number of people applying for rent at the beginning of this year increased by about 40% compared to January last year, but because there are very, very few properties available for rent, many landlords end up renting out at higher prices than the asking price, and many of them hardly wait long to find high-quality tenants. ”
James also described the boom in London's rental market, saying that every rental property in London now competes with 35 to 40 new tenants, and each of those that have decided to rent out receives at least four offers. As a result, tenants must move as quickly as possible and offer more attractive conditions to get the property they want.
Under such fierce competition, of course, it is the landlord who benefits.
Some media pointed out that because tenants want to rent high-quality properties, this gives landlords more say, so they have become more "picky" and have more requirements for tenants.
Andrew Townshend, 68, is a professional landlord with 16 properties.
Previously, a tenant wanted to rent a house he had in Norwich.
The tenant had a job and was able to afford it, but because he had been sentenced by the court twice in arrears, Andrew adamantly refused to rent him a house.
Later, the tenant offered to pay Andrew a one-time payment of six months' rent, but Andrew refused his application.
Andrew said: "The concern now is not that the house will not be rented out, but that it will be rented to bad tenants, because the eviction process is much longer and costly. ”
Andre added: "There is an extreme shortage of rental housing at the moment, which means landlords have more power over who to rent to. The competition is very, very fierce. The last property we rented out received 10 good offers. I can pick and choose at will. ”
Another renter said he could not rent it despite recently selling his house and having more than £1 million in his bank account. Because he doesn't have a full-time job, many landlords believe he is credit-risked.
Because they do not have to worry about renting out their houses, more and more landlords are also demanding that tenants with ordinary incomes should preferably be able to provide a guarantor before they are willing to rent their houses to them.
Last year, 13.5 percent of landlords required tenants to provide a guarantor, according to Goodlord, a figure that has grown by nearly half in two years.
In addition to the "selection" of tenants' jobs and incomes, the surge in demand for rental housing has also promoted the rise in rents, allowing landlords to earn "full pots".
【Rents continue to soar】
Reports from multiple agencies point out that rents in the UK have risen sharply...
Zoopla's latest figures show that UK rents rose 8.3% year-on-year in Q4 2021 to a new high of £969 per month.
This also means that the current average monthly rent is £62 more than pre-pandemic levels, which equates to an additional £744 per year.
It is worth noting that in this round of rise, large cities have become "leaders".
London, Belfast, Nottingham and Bristol all rose more than 10%.
Among them, rents in London rose by 10.3%, and the average monthly rent has increased to £1,640, nearly double the UK average. Inner London rose as much as 11%, ranking among the top in the country.
Zoopla analysis said that the rise in rent stems from the imbalance between supply and demand, on the demand side, as people gradually return to the office, international students and overseas people return, rental demand has increased significantly, but on the supply side, the supply of rental real estate is seriously insufficient, and the imbalance between supply and demand eventually drives the rise in rents.
According to the survey, rental demand increased significantly by 76% in January this year compared to the average in January 2018 to January 2021. In contrast, supply is nearly 40% below normal levels.
Because the supply of properties is in short supply, landlords now only need an average of 14 days to rent out the house, and there is basically no vacancy period.
Coincidentally, Rightmove's data reveals the same trend...
The agency said total leasing demand grew 32 percent in the fourth quarter of 2021 compared to the same period last year, and competition among tenants nearly doubled from the same period last year.
At the same time, due to the 51% decline in the number of properties available for rent. On average, landlords only need more than two weeks to rent out their house.
The data also shows that in the fourth quarter of last year, the average rental asking price in the UK increased by 9.9% year-on-year, reaching a new high of £1,068.
London's gains reached their highest level on record, up 10.9% year-on-year, with the average rental asking price rising to £2,142.
Not only that, but as people returned to the city centre, Inner London saw a 16.2% increase, with an average rent of £2,577.
Rightmove said the trend of rising rents may not be reversed in the short term because of insufficient supply of rental housing.
Although the rise in rents has brought huge benefits to landlords, the cost of renting has become higher and higher for tenants...
Zoopla expects renters to now have to take out 37% of their total income to pay rent. London has a higher proportion and needs to set aside 52% of its income for rent.
Under this standard, ONS said that only the 25% of the highest-income earners in London are currently able to rent without real stress.
Of course, for young people, this is not a happy thing...
However, some young people have chosen to break away from the vicious circle of "working for the landlord and not saving any savings" early. Some people even found out after buying a house that it was not cost-effective to rent a house!
If you are interested, you can also take a look at their stories (specific reference link: I heard that renting a house is equivalent to "working" for the landlord?). These people don't want to do it! ）
Moreover, some institutions pointed out that although house prices are getting higher and higher, for young people, there are also some advantages in buying a house at present, such as relatively low borrowing costs, a booming job market, etc., which provides support for young people to buy a house.
In addition, in order to help young people buy houses, the British government has also introduced various welfare policies, such as help-to-buy, etc., which can also be actively used.
Tips for the end of the property circle:
Judging from the actual performance, the epidemic has not caused an irreparable blow to the London rental market.
As the epidemic improved, the UK gradually lifted the lockdown, people began to return to the city, but also promoted the rise in rental demand, under the surge in demand, London's rent increase exceeded many people's expectations.
What is more worth mentioning is that with the return of overseas people, the performance of the rental market in central London is more "eye-catching", and the increase is amazing!
For investors, the UK is about to be completely unsealed, and the leasing demand will continue to be strong for some time to come, and everyone can take advantage of this opportunity.
For young people who have not yet bought a house, the rise in rents has squeezed the cost of living, and if conditions permit, everyone can also get on the bus as soon as possible and end the days of working for the landlord as soon as possible.