Mortgage savings passed on to tenants
As you may have heard, the property market is looking good for those who want to rent.
Reduced interest rates mean many of those who are letting their properties out are paying less for mortgages and that saving is being passed down the chain to tenants.
In fact, some might say those renting houses and apartments in the capital have not had it this good for a long time.
Partner for residential lettings at Cluttons Lynn Hilton said: "London's tenants are enjoying the greatest choice of rental property for years, combined with cheaper rents and greater negotiating power.
"The savviest among them are making multiple offers on properties and then choosing the best deal, while jittery landlords, keen to keep their properties tenanted, are agreeing deals."
The cuts go across the country but London and especially the Docklands are benefiting in particular, with job cuts also driving down the cost of renting.
Finaproperty.com claims the area around Canary Wharf has seen a significant drop.
Findaproperty's Andrew Smith said: "Areas that used to be populated by City workers, either renting by themselves or occupying a corporate let, have felt the pinch the most."
Hamptons International said the lack of overseas interest in London rental properties has added to the drop in rents.
"This has occurred due to less people coming to work in the capital from abroad.
The firm believes rental prices have fallen by 20 per cent in the last six months.
And with UK staff working longer hours due to shorter workforces, Hamptons argues people are now able to benefit from reduced rents and live closer to the office.
Head of residential lettings at company Lesley Cairns said: "Existing UK employees now often have to work longer hours with a post-credit crunch reduced workforce, with many people opting to live closer to work, which is now a possibility due to market conditions pushing down prime London rents.
"This was previously impossible with supply very much in demand and prices at an all-time high.
"This is a great market for tenants, because each week a property sits empty costs a landlord money and they are keen to dodge such void periods.
"With such an abundance of stock available, we urge landlords to be flexible and realistic about pricing."
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Landlords passing on savings? What planet, is the person who researched this article on?
If you're a landlord who has paid for an apartment in a development, you may or may not have reduced mortgage costs depending upon whether you have a tracker or fixed mortgage.
Secondly, the service charges in many developments have rocketed. Any savings made on mortgage costs have been eroded by increased service charges. Service charges of £5,000 a year are not uncommon. In some cases, the service charges are now bigger than the mortgage payments!
Thirdly, there are more tenants in the market as first time buyers find it hard to save for the increasingly large deposit now expected by banks before they grant a mortgage. Who wants to live and save in suburbia with Mum & Dad? Increased demand pushes up prices/rents! Admitedly, there's plenty of supply too. At some point though, the land to build on will run out (as it already has done for the prime riverside developments) the working population will continue to increase and the demand will far outweigh the supply. Landlords are treading water and hanging on in the hope of future gains.
Lastly, most landlords aren't fat cats! For many, a rental apartment has been a big investment for them, it might even be their pension plan and they treat their tenants with respect. The days of it being a route to riches are over and that might not be a bad thing if it prevents reckless and false, self certified mortgage applications that are reneged on when they can't afford the payments.