London lettings demand and supply rise

London’s lettings market has entered the new Renters’ Rights Act era with a notable rise in both supply and tenant demand, according to the latest data from Foxtons. Despite the legislative changes, the market shows resilience with steady rents and increased activity as spring progresses.

Supply and Demand Trends in London

Foxtons’ Lettings Market Index for April reveals that new listings in London were 3.7% higher compared to the same month last year, although there was a 6% decline from March following the early spring peak. This data provides a crucial snapshot of the market just before the Renters’ Rights Act came into force.

Tenant demand also saw growth, with applicant numbers rising by 9.5% month on month in April as renter registrations recovered during the spring season. However, demand remained 6% below April 2025 levels, indicating that while activity is increasing, it has not yet reached the heightened levels seen last year.

Rents and Tenant Budgets Remain Stable

Rents across the capital remained flat year on year, with tenants continuing to spend 99% of their budgets, mirroring the same level recorded in the previous year. This stability suggests that despite legislative changes and market fluctuations, tenants’ financial commitments to rent have remained consistent.

Landlords Benefit from Market Dynamics

Gareth Atkins, Foxtons’ managing director of lettings, commented on the market’s response to the new legislation: “The Renters’ Rights Act has landed in a busy season with momentum unimpeded by the new legislation. Applicant numbers have spiked, supply is strong and budgets are holding firm.”

He highlighted a behavioural shift among renters, noting they are moving earlier and acting more decisively, yet are also more selective about where they invest their time. Atkins emphasised the importance for landlords to approach lettings with the same professionalism as sales, stating, “A property that would have generated viewings on momentum alone two years ago now needs to earn them.”

He added, “The market is rewarding landlords who treat the launch of a let with the same care as the launch of a sale: clear positioning, accurate pricing, and a property that’s genuinely ready on day one.” This underscores the increasing need for landlords to present properties in excellent condition and price them appropriately to attract tenants swiftly.

Regional Variations in Supply and Demand

Foxtons’ year-to-date figures show a mixed picture across London’s regions. Overall supply across the city was 1% higher than last year, while new renter registrations were 6% lower. Central London experienced a significant 24% drop in new instructions and a 16% fall in renter registrations, reflecting ongoing challenges in the core market.

In contrast, East London saw supply rise by 7%, although demand fell by 7%. North London recorded the strongest increase in new instructions at 34%, despite a 3% decrease in renter registrations. South London’s supply was slightly down by 1%, with demand declining by 8%. West London showed the most robust growth, with new instructions up 40% and renter registrations increasing by 17%.

What this means for landlords

The current market conditions suggest landlords who maintain high standards in property presentation and pricing are more likely to attract tenants quickly. With tenant demand rising and supply improving in several London areas, competition among landlords to secure quality tenants is increasing. The behavioural shift towards earlier and more decisive renting decisions means landlords should be prepared to act swiftly and ensure their properties are market-ready from day one.

Moreover, regional disparities indicate that landlords in Central and South London may face more challenges in securing tenants compared to those in North and West London, where demand and supply are more favourable. Understanding these local market nuances will be crucial for landlords and agents aiming to optimise their lettings strategies under the new legislative framework.

Source: Based on reporting from Property118

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