Tenants prioritize ease of commute, pushing up rents in these areas

  • Savills says tenants in prosperous commute areas are prioritising their commute 
  • Areas with greatest hire rises this 12 months embrace Chester, Cobham and Weybridge

Tenants are prioritising the convenience of commuting as soon as once more as they search for a brand new residence, in response to new information from Savills.

The property agent stated this was mirrored in its newest information revealing standard commuter areas with the strongest rental progress.

These areas with the most effective progress within the first three months of this 12 months embrace Chester, Birmingham, Cobham and Weybridge, which noticed values rise 3.9 per cent, 3 per cent and a couple of per cent respectively.

Areas with biggest rent rises include Weybridge, where values have increased 2 per cent in the past three months

Areas with greatest hire rises embrace Weybridge, the place values have elevated 2 per cent previously three months

It is in sharp distinction to the beginning of the pandemic 4 years in the past when lockdowns prompted a ‘race for house’ within the property market as individuals flocked to the countryside and coastal areas.

As individuals return to the workplace, Savills stated tenants are prioritizing the convenience of their commute when selecting a brand new place to reside.

The enchantment of commuter belt spots akin to Cobham and Weybridge is the flexibility to get pleasure from surrounding countryside mixed with the facilities of a vibrant city and good transport hyperlinks.

The prepare station in Weybridge supplies prepare companies into central London which might be lower than half an hour. 

Areas with biggest rent rises include the city of Chester, where values have increased 3.9 per cent in the past three months

Areas with greatest hire rises embrace the town of Chester, the place values have elevated 3.9 per cent previously three months

Savills stated city areas usually proceed to outperform their surrounding areas, with regional cities and cities rising by 8.2 per cent on the 12 months in comparison with 2.3 per cent progress in surrounding areas.

Built-up areas in London’s commuter belt are additionally outperforming at 3.9 per cent in comparison with 1.5 per cent for extra rural commuter belt places.

Harriet Scanlan, of Richmond property company Antony Roberts, stated: ‘Despite a slight improve in properties obtainable to hire in areas standard with commuters akin to our a part of London, this hasn’t translated into cheaper rents. 

‘Tenants are offered with a wider array of decisions, resulting in a rise in viewings per property, but landlords proceed to profit from regular rental incomes and minimal-to-no void durations.

‘However, it is essential to notice whereas the modest improve in obtainable properties to hire is encouraging, it isn’t but enough to tip the scales in favour of renters. Supply continues to lag behind demand, making certain that rental costs stay sturdy.’

Growth in rental values in numerous areas and commuter areas
Q1 2024 Suburban Inner Commuter Outer Commuter Regional cities & cities Cotswolds & South West All Regional Offices
Quarterly progress 0.90% 0.70% 0.80% 0.90% 0.50% 0.90%
Quarterly progress, This fall 2023 -0.30% 0.30% 0.60% -0.60% -0.80% -0.20%
Annual progress 4.20% 2.20% 3.60% 7.40% 3.30% 4.00%
Growth since Mar-20 21.10% 24.30% 24.70% 26.90% 26.20% 23.90%
Source: Savills           

Expensive areas within the coronary heart of London will not be seeing an analogous rise in rental values.

They elevated 0.3 per cent through the first three months of this 12 months, with Savills attributing the slowing rental progress in the marketplace ‘slipping again right into a seasonal sample’.

It means rental values have elevated by 0.9 per cent previously three months throughout prosperous areas, whereas annual progress has slowed to 4 per cent.

However, Savills defined that rents nonetheless stay considerably increased, at 18 per cent, than earlier than the beginning of the pandemic.

Growth in rental values throughout totally different components of London
Q1 2024 Prime Central London North West London South West London West London North and East London All prime London
Quarterly progress Q1 2024 0.50% 0.60% -0.10% 1.10% 0.00% 0.30%
Quarterly progress This fall 2023 -0.50% 0.50% -0.40% 0.70% 0.00% -0.10%
Annual progress 2.50% 4.10% 2.90% 6.30% 2.70% 3.20%
Growth since March 2020 14.00% 18.90% 20.70% 21.30% 15.90% 17.70%
Source: Savills             
Rents in regional towns and cities continue to outperform their surrounding areas, says Savills

Rents in regional cities and cities proceed to outperform their surrounding areas, says Savills

Savills stated Chester, Birmingham, Cobham and Weybridge are among the many strongest performers this 12 months, as tenants re-prioritise ease of commute.

Jessica Tomlinson, of Savills, stated: ‘Rental progress picked up barely on the quarter, nonetheless, affordability pressures and elevated inventory imply rental progress has settled at a a lot decrease stage in contrast with the final three years.

‘But rents stay at a document excessive, and the prospect of falling mortgage charges is predicted to ease a few of the monetary burden on landlords.

‘Rental progress continues to exceed capital worth progress, which means that yields have improved throughout the sector, which is able to assist continued funding.

‘In London, homes are actually outperforming flats, signalling that the flats market possibly hitting an affordability ceiling, whereas tenants looking for homes usually have barely extra leeway relating to price range.

‘Also, a stronger gross sales market has constrained the variety of homes to hire throughout the capital, significantly throughout west and north west London.’