London Rents Decline as Work From Home Puts a Premium on Space

London rental values for private home fell in June as demand for property moved outside cities.

Rents in the U.K. capital declined 0.1%, the only region that didn’t enjoy an increase, the Office for National Statistics said Wednesday. Nationwide, the cost of letting a home rose 1.2% from a year ago, a rate unchanged since April.

More than a year of lockdowns to control the coronavirus has left workers seeking more space further from city centers, anticipating a permanent shift away from working full time in offices. The ONS also said it found more supply on the market with short-term lets moving toward longer term contracts.

London Rents Decline as Work From Home Puts a Premium on Space

The figures contrast with recent surveys suggesting a recovery in London prices. The estate agent Hamptons International found rents in central districts surged 4.3% in June from the previous month, the fastest pace on record. Another index compiled by Molior London showed sales of new London homes picked up in the second quarter.

The government on July 19 plans to drop its advice for those who can work from home to do so. After that, Prime Minister Boris Johnson says there can be a “gradual return to work.”

©2021 Bloomberg L.P.

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