Real estate in London is a hot commodity. Whether you’re a Russian oligarch looking to park your money in a ten million pound house you’ll never see in person or actually looking for a place for your family to live in, you can probably expect competition from others also looking for a home.
And chances are it’ll cost a pretty penny since London is consistently in the top ten of the world’s most expensive cities. That means that “affordability” is a relative term here: what is affordable for London is probably considered expensive in many other cities. Still, there are homes that are within reach of mere mortals like us. And a good rule of thumb is the farther you go from London’s center the cheaper it will be. The question then becomes: what sort of commute can you handle?
When looking for a home you may come across unfamiliar terminology, so here are the basics:
RENTING IN LONDON
Since London is an expensive city, those renting (referred to as ‘letting’ in the UK) spend, on average, two thirds of their income on rent. Part of this is driven by the high cost of living in the city, but it’s also driven by the high demand for properties.
Competition for rentals can be quite intense in many neighborhoods. Many rentals hold mass viewings on certain days where potential tenants all come through to see the property, adding to the stress of finding a home. And a small number of properties are rented out using an auction format where the highest bidder wins the right to sign a lease. The only good thing about this method is you can buy a new home while sitting in your current home wearing your pajamas and having a spot of tea. The bad part of that is watching the price sprint out of your reach in real time.
WHAT YOU’LL NEED TO RENT A PLACE IN LONDON
Below are the documents you’ll want to have ready before you start looking at rental properties:
TYPICAL RENTAL FEES IN LONDON
When it comes to renting in London you can use a real estate agent or work directly with a landlord or management company. There are fees charged to tenants and all ‘letting agents’ must fully disclose their fees and charges on their website and in their offices. Agents may charge you fees for:
Not all agencies charge these types of fees, however, so it is worth asking about. Also, it’s worth knowing that agencies cannot charge you for routine inspections during your tenancy or anything else they charge the landlord for. Note that you’ll incur many of these fees when working directly with a landlord as well, such as a credit check.
When you sign a lease with the landlord you’ll be required to put down a security deposit, which is typically equal to one or two month’s rent. When your lease ends and you move out this security deposit will be returned to you in full (unless you’ve caused any damage to the property or owe money to the landlord for unpaid bills). You’ll also be expected to pay for your first month’s rent and pay any letting fees — the average is £350 — so altogether this can be a significant outflow of money at one time.
HELPFUL REAL ESTATE WEBSITES
Rightmove.co.uk – There are several similar sites in the UK, but Rightmove seems to be the most comprehensive. You can search over 30,000 properties in any area of London to find homes for sale or for rent.
ADT Crime Maps – Get crime data on any area you’re considering to live in.