Asking rents in some of the UK’s biggest city centres saw annual falls of up to 12% in the last three months of 2020, a study has found.
Inner London has been hardest hit, with average asking rents falling annually by 12.4%, followed by Edinburgh city centre, where the drop in asking rents was also in double digits at 10%, and Manchester city centre, where they were down by 5.3%, according to Rightmove.
The study looked specifically at the centres of 10 of the biggest cities around Britain.
In all of the cities there has been a shift upwards in the number of tenants who currently live in a city inquiring about properties outside that city, Rightmove said, as the popularity of a quieter life and more space driven by lockdown continues.
There are still some city centres where asking rents have increased annually, including Bristol (2%) and Liverpool (2%), although both were below the national average of 3.7%.
Rightmove’s director of property data, Tim Bannister, said: “The price premium that many tenants are usually willing to pay to have the vibrancy of a city centre on their doorstep has been tempered for now.
“This brings a challenge for some landlords but also an opportunity for tenants who may be able to make a longer term decision and move into a city centre now, perhaps on a two-year tenancy agreement, at a more attractive rent than this time last year.”
Marc von Grundherr, director of London estate agent Benham and Reeves, said: “With Covid continuing to pose a problem on an ongoing basis, many tenants simply aren’t committing to the high cost of renting in central London.
“This has been largely driven by the fact that many can now work remotely but this isn’t the only reason.
“Living in central London is as much about the social aspect, as it is about the convenient commute and, at present, the vast majority of the capital remains closed for business.
“As a result, demand has fallen dramatically, causing rental stock to flood the market. This excess level of stock means that landlords are being forced to accept dramatically lower levels of rent just to avoid lengthy void periods between tenancies.”
Here are average asking rental prices per month in the fourth quarter of 2020, and the annual change, according to Rightmove:
– Inner London, £2,219, minus 12.4%
– Edinburgh, £1,124, minus 10.0%
– Manchester, £1,022, minus 5.3%
– Birmingham, £883, minus 4.6%
– Leeds, £811, minus 4.4%
– Glasgow, £894, minus 2.5%
– Nottingham, £921, minus 0.2%
– Newcastle, £915, minus 0.2%
– Liverpool, £801, 2.0%
– Bristol, £1,271, 2.0%