Job losses in City hit rental market
Monday 13 February 2012
Thousands of City job losses are hitting London's top-end rental market as bonuses are slashed and banks cut back on accommodation budgets, according to the estate agency Knight Frank.
The company's central London index showed that rents fell back by 0.2 per cent in January, leaving them 0.6 per cent below their September 2011 peak. Rental costs are are still 7 per cent higher than a year ago, but the agency said the market is likely to remain sluggish.
Knight Frank's head of residential research, Liam Bailey, said: "There are signs that the weakness in the City of London jobs market – where new employment vacancies are down 51 per cent year-on-year at the current time – is beginning to feed through to the rental sector.
"With the banking sector expected to deliver much lower bonuses in the first quarter of 2012 compared to last year, tenants who are building deposits for eventual entry to the housing market are looking to reduce their rental costs in the interim."
The consultancy Morgan McKinley's latest London Employment Monitor showed 2,835 jobs in financial services available in January – a big increase on December but fewer than half the 5,935 new jobs on offer in the City a year ago. State-backed Royal Bank of Scotland has culled 3,500 staff from its investment bank so far this year.
Financial firms are looking to house overseas staff for less than £1,000 a week, with a shortage of tenants looking for rental properties between £1,000 and £2,000 a week, Mr Bailey added. "Rental budgets for corporate tenants, employees who have been relocated to London by their firms, have been cut back by anything up to 15 per cent over the past 12 months."
A shortage of housing in London has driven up rents by more than a quarter in the past two years as demand for big deposits by newly cautious banks shuts would-be buyers out of the property market. But there are signs that tenants are unwilling to swallow further increases as salaries rise at a far slower rate. "Landlords are having to accept that continually rising rents are not a fixture of the market," Mr Bailey said.
- 1 Lego breaks out of the toy box and heads for the gallery
- 2 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
- 3 Piers Morgan attempts to save the Union by promising to go back to the US if Scotland votes 'No' to independence
- 4 Tyler, The Creator says having new U2 album automatically downloaded on his iPhone was 'like waking up with herpes'
- 5 Grandmas keep accidentally tagging themselves as Grandmaster Flash on Facebook
David Haines remembered: Death of British hostage executed by Isis lamented from the Balkans to Sudan
Jennifer Lawrence and Kate Upton nude pictures exhibition cancelled after artist concedes photos were 'stolen property'
David Haines beheading: David Cameron says Britain will hunt down Isis 'monsters' shown in video murdering aid worker
Piers Morgan attempts to save the Union by promising to go back to the US if Scotland votes 'No' to independence
Jennifer Lawrence to make public appearance after nude photo leaks as Met Gala Ball 2015 co-host
Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
George Galloway on Scottish independence: The political class is doing what Hitler couldn’t – destroying Britain
Scottish independence: Nationalist leader Jim Sillars threatens pro-union companies with 'day of reckoning' after independence
Scottish independence: Yes campaign feels the heat as Alex Salmond's NHS claims come under furious attack
Scottish independence: Britain faces 'constitutional crisis' at next election
£23m Birmingham cycle scheme is attacked by Tory councillor for not catering to the elderly
iJobs Money & Business
£280 - £320 per day: Ashdown Group: The Ashdown Group have been engaged by a l...
£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...
£35000 - £38000 per annum + Benefits: Ashdown Group: Training Coordinator / Pl...
Data Governance Manager (Solvency II) – Contract – Up to £450 daily rate, 6 month (may go Permanent)
£400 - £450 Per Day: Clearwater People Solutions Ltd: We are currently looking...