Listing price: will I have to pay more to secure a rental property?
There’s a common misconception among tenants who are new to the London rental market: the listing price is fixed. This figure is not set in stone, meaning potential tenants will enter a rental negotiation process that determines – among other things – the final price they will pay to rent the property.
Don’t worry, this doesn’t mean a bidding war is guaranteed. Before you prepare for a financial fight, you’ll be pleased to hear that London landlords typically accept the listed price – but some conditions stoke a competitive rental market, potentially forcing you to make an offer that exceeds this level.
Let’s explore three market conditions that have the biggest influence on the listing price – and the bidding process:
Time of year
Listing prices in London blow hot and cold throughout the year due to seasonal variations. Rental demand and value typically peak during summer because school holidays make it a popular time to move. Consequently, landlords tend to raise their rental prices during this competitive period.
Conversely, tenancy rates tend to decline during winter, prompting landlords to reduce their prices. This seasonal lull creates opportunities for tenants who are willing to make long-term commitments or negotiate lower rent prices with landlords.
The size of a property, notably the number of bedrooms and bathrooms, is the obvious determining factor when it comes to the rental price. Understandably, larger properties in London will fetch higher rental prices than smaller properties. In terms of agreeing on a final rental price, you are likely to face stiffer competition for small properties amid greater demand.
Properties in desirable London neighbourhoods with easy access to transport links, local schools, shopping centres, and public parks generally command higher rental prices. For example, school catchment areas often spark rental bidding wars between parents who are determined to live close enough to a top-ranked state school to secure a place for their child.
All roads lead to demand when it comes to the factors that influence rental negotiations. To sidestep a bidding war amid high demand be prepared to search during off-peak periods, offer on properties with a budget that is slightly over the average, or consider properties that are further from desirable amenities.