Tenants start to gazump as average rent hits £1,000

Average London rents have broken through the £1,000 a month barrier for the first time.

They rose by 6.9 per cent to £1,006 in the year to this month as tenants locked out of the mortgage market scrambled to secure a place to live.

David Newnes, estate agency managing director of LSL Property Services, said: "Tenant demand continues to reach higher peaks - and there isn't enough rental property coming onto the market to match it. It's not unheard of for rental properties to be let within a day of coming onto the market.

"There's no sign of a let-up. Despite several new deals on the market, securing a big enough mortgage remains a tall order for the average buyer."

In some cases, gazumping and sealed bids - normally limited to home purchases - are occurring.

Agents say they have also see a sharp rise in the number of corporate tenants looking for accommodation in central London for senior executives.

Amelia Greene, residential lettings partner at Cluttons, said it had recently let a 6,500 square foot house in Onslow Gardens in South Kensington for almost £10,000 a week.

At the other end of the scale, tenants on housing benefit will have caps on their claims imposed next April forcing an estimated 82,000 London households to move as they will no longer be able to afford the rent, according to London Councils.

Housing charity Shelter said 22 per cent of 18- 34-year-olds have had to move back in or continue living with their parents because they can't afford to rent or buy a home.