Ride The Rental Rollercoaster

By Mollie Swallow, Lettings Director

Cast your mind back to 1971, when Antoine Lurot took over the estate agency business we know in 2022 as Lurot Brand. Back then, the company was very active in the lettings market. Not long after, Antoine made mews properties the focus of the business and soon property sales really started to take off in 1986. In fact, the company became so busy, that juggling both sales and the lettings department simultaneously became tricky and eventually, the lettings side of the business was dropped.

Luckily for Lurot Brand, shortly before the sales market turned in June 1988, someone in the business had decided to resurrect the lettings side. This turned out to be a prophetic move as Lurot Brand was far better placed to tackle the sudden surge in demand for rentals in Prime Central London when it happened.

This is by no means the only example of how Lurot Brand has had to be something of a chameleon in all its years of trading, to anticipate and deal with the dramatic shifts that can strike the residential market in Prime Central London. As we travel through the different years, we can see this pattern unfolding, when the rental market tanked in 2006. However, after the big crash in 2008, we saw a revival in the fortunes of the rental market, with rental properties achieving record prices across the capital, and up until recently, this has continued.

Fast forward to 2020, when the unforeseen impact of Covid-19 across the world, triggered a mass exodus of Londoners moving to the country. This caused rental prices to plummet to levels not seen in years.

Now that life is returning to a new normal and an increasing amount of people begin to move back to London, 2022 is mirroring the demand that we experienced in the years 1988 and 2008. There has been an influx of enquiries from renters moving back to the city and prices are once again on the up. We now have a situation where there is just not enough stock to meet demands.

For those savvy landlords, who listened to the advice of their agent, took a pragmatic view and kept hold of their rental investments, and accepted a lower rent for a period of 12-24 months, some agreeing to a reduction as much as 40 per cent, their patience has reaped the rewards. This year we have already achieved records prices in several mews streets. To have achieved some of these high levels of rent is extraordinary, given that traditionally, the first quarter is well known as the quietest period of the year for any lettings business.

And the moral of the tale… the best advice I can give to a landlord, is to stick with the tricky times. History always repeats itself and whilst the market will undoubtedly experience poor rental values that might not be ideal for a year or two, in the end, prices do bounce back and, if history has taught us anything, they can very possibly increase.