Tom Smith from Knight Frank discusses the strong performance of the Belgravia lettings market in 2011, with a 6.7% rent rise and a focus on high-demand 'best in class' properties. The market remains robust due to international demand, with expectations of a further 4-5% price increase in 2012. Belgravia stands out for its distinct architecture and appealing amenities, attracting a diverse tenant base.

1. SNAPSHOT SPRING 2012
RESIDENTIAL RESEARCH
Belgravia lettings
Tom Smith, Head of Knight Frank’s Belgravia Lettings team,
discusses where tenants tend to come from, the benefit of using
Knight Frank, and how the market is likely to perform in the
coming months.
How has your market been
performing?
market trough in early 2009 and 2% higher than
the previous record high hit in March 2008.
For the majority of 2011 the Belgravia lettings
market performed solidly with strong demand
across the board and by the end of June rents
had surpassed their 2007 peak largely driven
by limited stock levels. Strong rental growth
outpaced capital value growth over the past year,
pulling income yields higher as a consequence.
Approaching year end economic uncertainties
combined with a seasonally quiet Christmas period
saw rents fall slightly. In spite of this, 2011 saw rent
rises of 6.7%.
What advice can you give to
landlords?
“
Belgravia is long
established as the
premier residential
address in
london and best
known for white
stucco-fronted
architecture,
immaculately
maintained streets
and peaceful
garden squares.
“
Have any particular trends emerged
recently in your rental market?
We have seen continued demand this year for
refurbished ‘turnkey’ or ‘best in class’ properties
and new price benchmarks are being set for them.
Many of these ‘best in class’ properties have been
successfully rented before hitting the open market.
In contrast to recent years, there has also been a
real appetite for family houses. House rents have
accounted for 30% of all transactions this year and
prime London rents are now 27% higher than the
Presentation and price. Presentation is key if
top rents are to be achieved. Our predominantly
international tenant base are seeking
immediate gratification and are quite prepared
to pay for it. We would always advise that a
landlord seek a professional viewpoint when
refurbishing a property. It is important to cater
to the target market rather than one’s personal
taste. Any potential weaknesses in a property
will provide scope for negotiations on the
guide price. A realistic price is imperative to
minimising void periods.
What stands Belgravia apart from
other prime areas in London?
Belgravia is best known for white stucco-fronted
architecture, immaculately maintained streets
and peaceful garden squares. Belgravia is long
established as the premier residential address
in London. Just minutes from Buckingham
Palace, Sloane Street and Knightsbridge,
Belgravia is known for its village-like cluster
of boutiques, jewellers and restaurants sitting
alongside elegant and historic private houses.
Belgravia lettings market
at a glance
Figure 1
What do our applicants want to spend?
New applicants, past 12 months
under £500pw
£500pw to £750pw
£750pw to £1,000pw
£1,000pw to £1,500pw
£1,500pw to £2,500pw
over £2,500pw
23%
11%
12%
16%
16%
22%
Figure 2
What is coming to market?
New instructions, past 12 months
How do you expect your market to
perform over the coming months?
The market remains strong in Belgravia,
underpinned by continuing international and
local demand. There is no sign that this will
change in the future. Our Residential Research
department expects prices to rise a further 4%
to 5% throughout 2012.
Tom Smith
Associate
+44 (0)20 7881 7730
tom.smith@knightfrank.com
under £500pw
£500pw to £750pw
£750pw to £1,000pw
£1,000pw to £1,500pw
£1,500pw to £2,500pw
over £2,500pw
12%
11%
5%
13%
20%
39%

2. SNAPSHOT SPRING 2012
RESIDENTIAL RESEARCH
Belgravia lettings
Charting the Belgravia lettings market
Figure 3
Figure 5
Tenancies agreed, past 12 months
Year-on-year change (November 2011 to January 2012)
Market activity
Tenancies by price band
under £500pw
£500pw to £750pw
£750pw to £1,000pw
£1,000pw to £1,500pw
£1,500pw to £2,500pw
over £2,500pw
Exchanges
31%
15%
6%
12%
15%
21%
113%
New applicants
21%
New instructions
47%
Viewings
69%
Prices
3.1%
Figure 4
Figure 6
Tenants, past 12 months
Prime London (rental prices) vs FTSE 100, past 5 Years
Wider market performance
Nationality of our tenants
UK
USA
French
Russian
Chinese
Others
120
47%
10%
5%
5%
3%
30%
FTSE 100
100
Prime Central
London
80
60
40
Prime Outer
London
Q1-Q4
2007
Q1-Q4
2008
Q1-Q4
2009
Q1-Q4
2010
Q1-Q4
2011
Belgravia properties and the Knight Frank team
LET & MANAGED
to let
Immaculate garden flat
Stunning mews house
Eaton Square
Lowndes Close
1
£1,300pw
2
£3,700pw
let
to let
Contemporary
refurbished house
Impressive family home
South Eaton Place
Bourne Street
5
£5,950pw
6
£8,500pw
let
to let
Elegant duplex apartment
Luxury Belgravia flat
Eaton Square
Eaton Place
3
£2,650pw
2
£2,500pw
Knight Frank Belgravia Lettings
+44 (0)20 7881 7730
belgravia@knightfrank.com
82/83 Chester Square
London SW1W 9HJ
knightfrank.co.uk/lettings
Tom Smith
Associate
Clare Foster
Senior Negotiator
Harriet Barber
Negotiator
Lucy Hunnisett
Administrator
If you have any queries or would like to obtain additional information on the UK or international housing markets please contact: Liam Bailey, Head of Residential Research, +44 (0)20 7861 5133, liam.bailey@knightfrank.com
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