London records drop in home renting cost for four consecutive months
The cost of renting a home in London fell for the fourth month in a row, continuing the first period of decline since 2009 as Britain’s exit from the European Union rattles the U.K. capital’s real-estate market.
The average monthly rent paid for new lettings in greater London in July was 1,564 pounds ($2,039), a 0.6 percent decline from a year earlier, according to a statement from HomeLet, the U.K.’s largest reference-checking, and rentals-insurance company. Rents across the U.K. gained 1.1 percent overall, led by increases in Northern Ireland and Scotland.
London’s housing market is weakening as uncertainty surrounding Brexit adds to affordability issues and new taxes, and the capital is now acting as a “brake” on the overall U.K. market, HomeLet said. Landlords rushed to buy homes before the introduction of a new stamp-duty sales tax in April of last year, boosting supply and leading to greater competition for tenants.
While the pace of decline in London has slowed, “the capital’s rental market still looks transformed compared to this time last year, when rents were rising at a rate of 6.6 percent,” HomeLet said.
Home prices in the capital are rising at the slowest annual pace in five years, data from researcher Acadata show.