As restrictions have eased, residents have been moving back in increasing numbers, but neither New York nor London is as busy as it was before the pandemic. Workplace visits in New York are still 24 per cent down on pre-pandemic averages; in London, they are down 37 per cent.
And yet prices are racing. In New York, the median rental price has jumped 20 per cent in the past year — 10 per cent up on March 2020. In London, the average rental price has increased 14 per cent in the past year, or 4 per cent since the pandemic started.
Paul Cheshire, a professor emeritus at the London School of Economics, says rental prices are often highly sensitive to short-term fluctuations in demand because there has been so little new rental housebuilding in recent years. “In London, the recent increase in demand is happening against the background of an incredibly inelastic supply of homes in total,” he says.
Booming sales prices are also pricing out would-be buyers, forcing them to continue renting. In the US — where the average sale price increased 17 per cent in 2021 — 4.75mn renters bought homes in the second half of last year, down from 5.5mn in the same period in 2020, according to Zelman & Associates, a housing research and advisory company in New York. Others are renting out of choice, says Cheshire. “The pandemic has made people less certain about where they want to live in the long-term, and so more likely to rent.
The fastest increases in rental prices in both London and New York have been reported in the most desirable areas — largely because these areas experienced the biggest dips when pandemic restrictions were first imposed. The median rental price in Manhattan’s Upper East Side and Upper West Side increased 42 per cent and 45 per cent respectively in the year to March, according to Serhant. Those in Upper Manhattan gained just 10 per cent.
In London’s Chelsea and South Kensington, the price of renting a room in a shared house increased 28 per cent and 27 per cent respectively in the first three months of this year, compared with a year earlier, according to SpareRoom, the rental portal. The average across London as a whole was 12 per cent.
Berlin is often held up as a model affordable rental market, with a network of rent control regulations and public housing keeping prices low and tenures secure. But recent efforts to protect tenants have foundered. In April 2021, the courts struck down a rent control rule that covered many of the city’s rental homes; many tenants had to repay the money they saved for the months their rents were capped.
Asking prices for rental apartments have increased by 18 per cent in the past year. This is widening the gap between those fortunate enough to live in homes where the rent is controlled, and the rest
Greed
I think it is a combination of corporate greed and the lack of regulation. If corporations ( funds) were limited by x% of housing ownership in a area and foreign owners were capped on the number of homes- this would go a long way to freeing up property and suppressing the leverage on large holder landlords.
This article doesn’t even attempt to answer the question.
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As restrictions have eased, residents have been moving back in increasing numbers, but neither New York nor London is as busy as it was before the pandemic. Workplace visits in New York are still 24 per cent down on pre-pandemic averages; in London, they are down 37 per cent.
And yet prices are racing. In New York, the median rental price has jumped 20 per cent in the past year — 10 per cent up on March 2020. In London, the average rental price has increased 14 per cent in the past year, or 4 per cent since the pandemic started.
Paul Cheshire, a professor emeritus at the London School of Economics, says rental prices are often highly sensitive to short-term fluctuations in demand because there has been so little new rental housebuilding in recent years. “In London, the recent increase in demand is happening against the background of an incredibly inelastic supply of homes in total,” he says.
Booming sales prices are also pricing out would-be buyers, forcing them to continue renting. In the US — where the average sale price increased 17 per cent in 2021 — 4.75mn renters bought homes in the second half of last year, down from 5.5mn in the same period in 2020, according to Zelman & Associates, a housing research and advisory company in New York. Others are renting out of choice, says Cheshire. “The pandemic has made people less certain about where they want to live in the long-term, and so more likely to rent.
The fastest increases in rental prices in both London and New York have been reported in the most desirable areas — largely because these areas experienced the biggest dips when pandemic restrictions were first imposed. The median rental price in Manhattan’s Upper East Side and Upper West Side increased 42 per cent and 45 per cent respectively in the year to March, according to Serhant. Those in Upper Manhattan gained just 10 per cent.
In London’s Chelsea and South Kensington, the price of renting a room in a shared house increased 28 per cent and 27 per cent respectively in the first three months of this year, compared with a year earlier, according to SpareRoom, the rental portal. The average across London as a whole was 12 per cent.
Berlin is often held up as a model affordable rental market, with a network of rent control regulations and public housing keeping prices low and tenures secure. But recent efforts to protect tenants have foundered. In April 2021, the courts struck down a rent control rule that covered many of the city’s rental homes; many tenants had to repay the money they saved for the months their rents were capped.
Asking prices for rental apartments have increased by 18 per cent in the past year. This is widening the gap between those fortunate enough to live in homes where the rent is controlled, and the rest
Greed
I think it is a combination of corporate greed and the lack of regulation. If corporations ( funds) were limited by x% of housing ownership in a area and foreign owners were capped on the number of homes- this would go a long way to freeing up property and suppressing the leverage on large holder landlords.
This article doesn’t even attempt to answer the question.
Greed.
Easy, next.