Largest drop in Richmond rents last year as London costs continue to rise

By Sophie Donovan
January 17 2020, 14.40

New research shows Richmond upon Thames experienced the largest drop in rental values in London between 2018 and 2019.

While the cost of private renting increased by 0.9% in the capital as a whole, Richmond placed sixth in the lowest rental growth by area with a percentage decrease of 7.2%.

Lowest Rental Growth by Area (Figures provided by Howsy)

The average property rent in the borough currently stands at £1,474 pcm for a one bedroom, and £2,103 pcm for a two bedroom property.

For Howsy’s head of content Polly Rivers, 31, it was important that the new decade started with an attempt to dispel the myths about rental costs.

“Everyone assumes rent is just going to climb and climb. I think there’s quite a lot of negativity at the fact that rents go up, no matter what happens and that’s not really always the case.

“Yes, it’s gone up in areas that have a massively small rental pool and they’re just in high demand.

“That’s as sure as eggs are eggs is going to happen. But in Richmond it’s done down massively and that’s great news.”

While it will take further research to confirm the cause of this, Ms Rivers had one idea.

She said: “I think a lot of the reason was probably to do with the Houses in Multiple Occupation (HMO) legislation changes.

“Back in October 2018, there was some legislation that came in that meant there were very specific room sizes that were applied, and rooms had to be, for one adult, no smaller than 6.51 square metres and for two adults no smaller than 10.22 square metres.

“This would make sense as to why there’s a big drop in rates, because if you’ve got a house that’s renting at £2000 because you’ve got four rooms renting at £500, if all of a sudden you’ve only got two rooms renting at £500, you’ve halved your rent rate.”          

Although Richmond councillor Liz Jaeger had an alternative reason: “My thoughts would have been that house prices have come down a bit locally, and in a normal market the two things go together up to a point.”

Affordable housing is now a priority for Richmond following on from the launch of the Richmond Tenancy Strategy in 2019.

Talking of Richmond’s housing goals for 2020, Cllr Jaeger was optimist

She said: “What we’re trying to do is make the most of what we’ve got.

“It may feel a little bit like rearranging the deck chairs on the Titanic. Nevertheless, there are things we can do.”

One of two new developments in Teddington, on the riverside, aims to lessen the problem of occupying by marketing them to smaller families occupying three or four bedroom homes.

To benefit the wider Richmond population, Cllr Jaeger has a clear number in mind: “Whatever you’re able to bring in, whatever way, you shouldn’t be spending more than 45% on your housing costs.”

For Howsy founder and CEO Calum Brannan, this might be an achievable goal not so far in the future: “With a number of legislative changes introduced this year, the rental sector should become a better, more transparent place for tenants and landlords alike as we head into a new decade and this is something we can all look forward to regardless of the change in rental costs.”   

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