Three-bed London rentals command a premium
Rents on three-bedroom homes in the capital are still rising, while they have dropped on one- and two-bedroom properties, according to new findings from Landbay.
Two-bed homes saw rents fall 0.69% over the last year, totalling £160 in annual rental payments for an average property, and -0.90% since their peak of £1,943 in March this year. One-bed flats in the capital fell by 0.32% in 2016.
In fact, three-bed properties are the only property size in London where rents have ended the year without notable falls, remaining flat year on year by the end of 2016, at an average rent of £2,690.
The price of an extra room?
The uplift in rent between one and two-bed properties across the UK (excluding London) is 19%, and only 15% when rising from a two-bed to a three-bed.
However the divide is more stark in London where rents jump by twice the national average (32%) from £1,455 for a one-bed to £1,926 for a two-bed, and a staggering three times the national average (40%) to £2,690 for an in-demand three-bed.
John Goodall, CEO and co-founder of Landbay said: “As house prices rise further out of reach of aspiring homeowners, Generation Rent is growing both in volume and household size, with people more likely to be in rental accommodation as they begin and grow their families. In London, where space is already at a premium, a relatively well-served two-bed rental market means those looking for more space now pay dearly for that extra bedroom.
“The government’s recent £7bn commitment to build 200,000 starter homes is step in the right direction, and it’s good to hear this will include a wide range of tenures across the private rental sector, but we mustn’t overlook the growing demand for larger rental properties, both in the capital and across the country.”