Landlords have faced a tense period leading up to Rachel Reeves’ Autumn Budget, with the looming possibility of an increase in Capital Gains Tax being a primary concern.
As the Chancellor’s announcement approached, the sector collectively held its breath. In a relief to property investors, the day concluded with confirmation that Capital Gains Tax rates would remain unchanged for buy-to-let properties. However, landlords didn’t escape entirely unscathed: the Chancellor announced an increase in the stamp duty surcharge on second property purchases, raising it from 3% to 5%. This change will likely dampen investment in the buy-to-let market, adding further pressure to rental supply and contributing to rising rents.
The rental market across prime London has entered a phase of moderation, with rents rising by just 0.5% over Q3. This slower pace contrasts with recent years and signals a return to more balanced supply and demand. Affordability constraints are influencing both tenants and landlords to adopt a more cautious approach. Annual rental growth across prime London now stands at 1.4%—the lowest since 2021—indicating that tenants are beginning to anticipate price stabilization after a prolonged period of rapid increases.
Demand for smaller, lower-value properties remains resilient, with flats across London rising by 1.1% over Q3. In contrast, high-value, larger homes in prime areas, including Knightsbridge, have seen rents dip by 1.4% in response to seasonal and discretionary demand declines. We’re also observing a shift in expectations between tenants and landlords: while many tenants anticipate a potential softening of rental values, landlords remain more optimistic, bolstered by rising mortgage costs and a shifting regulatory environment.
Looking ahead, landlords should brace for a quieter fourth quarter, with realistic asking prices becoming essential to securing high-quality tenancies and minimizing voids. Regulatory changes, particularly the Renters’ Rights Bill and potential tax reforms, could impact market sentiment. However, the prime market, including Knightsbridge, is somewhat insulated, as high-value properties may face fewer impacts from the upcoming regulations on Assured Shorthold Tenancies.
Despite these shifts, the outlook for landlords with a long-term view remains strong. Mortgage rates are expected to gradually decrease, and the fundamentals of the Knightsbridge market continue to be attractive. Prime property yields remain stable, and demand for high-quality, lifestyle-rich properties is likely to persist.
In legislative news, the Renters’ Rights Bill is currently in the committee stage, where it will undergo detailed examination, evidence gathering, and potential amendments. This stage is expected to conclude by November 28, 2024. The bill will then return to Parliament for a final reading before advancing to the House of Lords. We’ll provide updates on how this may affect landlords and tenants once the full details are known. In the meantime, if you have questions or would like a free property appraisal, please don’t hesitate to get in touch.
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Fraser Gregory
I started my career in 2008 at one of the largest agencies in the UK before taking the leap into the independent agency sector. I joined Plaza in 2012 and I’ve never looked back. Being part of a boutique family owned agency has been such a rewarding experience allowing me to be involved in every aspect of the lettings process. I have developed my skill and knowledge over the years by successfully passing the NFOPP Technical Award in Residential Lettings and Property Management. A nationally recognised qualification of Propertymark; The National Association of Estate Agents (NAEA) and Association of Residential Letting Agents (ARLA) I’m proud to be part of a company that has been involved in the community for nearly 50 years.
If you want 5-star reviews and want to remove negative reviews from Google, contact me via my profile; my contact details are listed there.
SM
Dear Eitan
In this whole sorry saga, with headbutting, unproactive lawyers, and a comatose estate agent etc etc, you have been a beacon of light throughout. Efficient, professional and responsive. This would never have got done without you.
Thank you.
All the best.
Maurice Shasha
We have been using Plaza Estates for many years for all our property requirements (sales, letting and management) and are delighted with the results and service they constantly deliver and provide!
KS
I generally dealt with the Marble Arch branch most of the time, but I can also say that the Knightsbridge office was also exceptionally helpful and professional on the occasions I did deal with them. Plaza Estates in general are excellent.
YZ
Have interacted with Plaza Estates across a couple of sites and always been impressed. Maurice must be the hardest working, most dedicated, helpful and knowledgeable account manager for any company anywhere! A real asset to the team!
LI
I have been a client of Plaza Estates for over 30 years and received excellent service. Both Rodney on the rental side and Fiona in the property management area have been have been attentive and helpful and always willing to go the extra mile on the few occasions when there were problems.
SA
Hope both of you are doing well. I wanted to thank you for always being there for us and for addressing our concerns promptly; safe to say you have been the best agents I have had the pleasure of interacting with.
KR
We have owned our Flat since 2008, which we purchased through Plaza. Our relationship with Plaza goes back to 1982 when we purchased a nearby flat and Plaza have handled all our lettings since then. I would have no hesitation in recommending Plaza - they will find you a good tenant and ensure your ...
MS
Thank you again for all your advice and calm attitude and charm. Nobody could try harder than you, and for which, we really thank you and appreciate it all, not just now, but over the years.
Thanks again for everything!
