Wealthy international students prepared to pay rents as costly as £1,000 a week, are enhancing the London lettings market.
Their parents, who desire their children to study at one of London’s respected universities, often pay their rent.
Head of Lettings at central London agency W A Ellis, Lucy Morton, says: “We’ve had two properties where three students were bidding against each other. We do not believe that we will have any studio or one bedroom flats left for letting if this frenzy continues.”1
Parents who are trying to avoid the higher cost of buying a high-end property are propelling the increase in demand for expensive rental properties, experts believe. Stamp Duty on properties worth over £2m has been raised to 7%, and the Government now charges 15% on the cost of properties worth more than £2m purchased by companies.
These actions are intended to prevent tax avoidance, however, they are leaving parents who would have previously bought a house for their children, looking to rent. Lots of students from Russia, Asia and the Middle East come to London to study, and expect high quality accommodation with modern décor, contemporary fixtures and fittings, and inbuilt technology.
Generally, the student lettings sector provides landlords with strong returns, and those with property within prime areas of London, such as Knightsbridge or Belgravia, could see even higher yields.