| Extra Supply in London Driving Down Rents |
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What kind of supply are we looking at here that can threaten a market to a grinding and painful stop? One hundred thirty one percent increase in the last year alone. This is enough to drive businesses in the other sectors berserk. BTL landlords are now in the “spotlight”; because people are waiting for their next move. How about the tenants? What percentage are we looking at here? According to the same statistics office the percentage of tenants has only increased by twenty seven percent, and not all of these would eventually get a new pad of their own through rent. These figures only reflect the percentile increase of applicants, and not exactly tenants. Couple this low figure with the one hundred thirty percent mark, and you have a burgeoning problem that truly awaits a solution. It’s a fact too, that tenants have gotten wind the rental economy is dropping, which makes the market base itself more fickle and more critical of the whole system. Increased expectation means that houses that have higher rent won’t be looked at- and the ones who are in danger of not being occupied at all for a whole year are forced to drop rates, even if the disparity does not equalize the capital outlay for a particular property. In the popular city of London, the number of rents dropped by an alarming six percent, something that actually hurts investments a lot. Because every tenant counts, a cut on the already dwindling number of tenants means that there would be a lot of properties that would have nothing to regain investment. Small victories can be found in other cities around the United Kingdom, though these small victories are not enough to counter the crisis in the larger scale. Locations in the United Kingdom that are experiencing positive cash flows include Chiswick and the place they call Notting Hill. With this crisis on the loose, people are bound to flock to less expensive areas in the United Kingdom. |
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