LCP: Prime London time to let drops to lowest level since March 2020

The time taken to let a vacant property in the prime London market decreased in Q1 2021 to 64 days, the lowest level since March 2020 prior to the first UK lockdown, according to London Central Portfolio (LCP).

The void period between tenancies remained above LCP’s historic average, but the recent decrease indicates a return of activity in the rental market despite challenging times.

An estimated 86% of new tenants in prime London in Q1 2021 were 30 or under, continuing a trend seen in 2020.

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As the level of available stock in this market decreases, there has been a reduction in the rental discounts demanded on re-lets in recent months.

Rents have not yet returned to previous passing levels; however, the upward trajectory provides positive early signs ahead of the traditionally busy summer period.

Marylebone and Pimlico were the London hotspots in Q1 2021, with more than half of new applicants wanting to move to these areas, while only 6% of new applicants had no preference as to prime London locations.

Tenants from the banking and financial industries represented the most new move-ins at 39%, followed by high net worth (HNW) students at 22%.

Andrew Weir, chief executive of LCP, said: “Despite a third UK lockdown, Q1 2021 saw a continued desire to live in prime London.

“Village-like neighbourhoods with good shopping facilities and outdoor recreation received the most demand.

“Our tenant base continues to be formed from a diverse array of professions and industries.

“One of the qualifications that classifies London as a global city is the wide range of ancillary industries that surround and support the City of London; breadth and depth that has been decades in the making.

“With a roadmap out of lockdown, rental activity increased over the quarter resulting in less available stock than this time prior year, as opportunistic UK-based tenants continued to benefit from discounted rents.

“Void periods remained higher than pre-COVID levels but Q1 2021 saw the shortest voids since the pandemic.

“Whilst it is too early to declare the return of normality, perhaps we are beginning to witness the positive effects of a successful vaccine roll out and easing of government restrictions.

“A continuing trend which has accelerated across the previous year is the younger audience renting in prime London.

“86% of new tenancies in Q1 2021 were 30 years old or under, a 23% increase from prior year.

“A strong indication of what a post-COVID London may look like with a new generation viewing the capital as an employment hub and with the easing of restrictions, a vibrant cultural city.”