Tired of Waiting Posted September 13, 2009 Share Posted September 13, 2009 (edited) If this chart is right (from primelocation) then rents in Prime London (PL) will keep falling. Will the Buy To Let there cope with it? Rents about 20% lower in one year. And despite that, stocks doubled. And are about 3 times higher than in Jun 2007. Edited September 13, 2009 by Tired of waiting Quote Link to comment Share on other sites More sharing options...
Bubble&Squeak Posted September 13, 2009 Share Posted September 13, 2009 (edited) If this chart is right (from primelocation) then rents in Prime London (PL) will keep falling.{SNIP} Very interesting... looking at the FinaProperty rental index for August they also claim a drop in rents of around 6%, this would appear to be across the board rather than "Prime London" (I will have a look to see exactly what Prime London means) The quote from Michael O’Flynn is also interesting: Michael O’Flynn, Director of FindaProperty.com, comments:“The London rental market seems to be largely immune to the recovery seen in the rest of the country. This is partly attributable to the dominance of flats, of which there is a glut. On top of that, there are fewer new graduates and first jobbers coming to live in London, because of the lack of jobs at the moment. In the current environment, houses for rent in London are faring somewhat better, with some families who in other circumstances would have bought a house turning to the rental market instead. I think we may have to wait until there is a widespread uplift in the economic outlook and an improvement in the jobs market before we see a real recovery in the rental market in London.†EDIT: to reduce quoted text Edited September 13, 2009 by Bubble&Squeak Quote Link to comment Share on other sites More sharing options...
Tired of Waiting Posted September 14, 2009 Author Share Posted September 14, 2009 Very interesting... looking at the FinaProperty rental index for August they also claim a drop in rents of around 6%, this would appear to be across the board rather than "Prime London" (I will have a look to see exactly what Prime London means)The quote from Michael O’Flynn is also interesting It seems that by "Prime" London they mean: "Central London, Central/South West London, North West London, Islington, City & Docklands, West/South West London." To see the web page you have to click the upper middle tab "Prime Lettings Index", at: http://www.primelocation.com/house-price-index Is this "Michael O’Flynn" really believing in the gov. spin, that the "recession is over", and we will have a "recovery" from now onwards?! Is anyone really buying into that? If so, it does boggle the mind. Or is he just trying to "talk the market up"? Quote Link to comment Share on other sites More sharing options...
Tired of Waiting Posted September 14, 2009 Author Share Posted September 14, 2009 they also claim a drop in rents of around 6% If the stock really went up like that, then it will surely force rents down. The question becomes: by how much? The answer depends on what economists call "price elasticity", or, how sensitive the price/demand is. In some products, a small change in price results in a big change in demand. In other cases, it doesn't much. It depends on competition, need, etc. I guess people need to live somewhere, but they can share, go back to parents home, downsize, commute, etc. And when someone loses a job, they have no choice. Besides trying to think, one could also see what happened in previous crashes. Anybody has any info/idea? Cheers Quote Link to comment Share on other sites More sharing options...
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