Concern as landlords go for gold as Olympics near

News Category: Industry News

Agents in London are coming under pressure from landlords and house owners who are going for gold, asking huge rental prices during next summer’s Olympics.

In some cases, asking rents are already rocketing six times normal value, while some agents are being put on the spot because of legalities.

Owner occupiers who are keen to cash in are often unaware that their lease may prohibit renting out their property, but that in any case they will have to seek permission from their lender and insurers, and quite possibly planning consent for change of use.

In some areas of London, even properties that are already rented out may breach local council requirements if they become short-term lets of less than 90 days. A breach could lead to a fine of up to £20,000.

High-profile agent Foxtons is one that is advertising Olympic lets at record-breaking prices – for instance, a penthouse in Knightsbridge is being advertised at £100,000 a week as an Olympics let.

The most expensive rental property in the UK, it puts into the shade the previous record-holder – a four-bed penthouse let out (by Harrods Estates) in August to a Middle Eastern billionaire at a mere £55,000 a week.

But even a one-bed apartment in South Kensington is currently being advertised by Foxtons as a £7,000 a week Olympics let.

Zoopla currently quotes the most expensive one-bed apartment in the South Kensington area as £2,100 a week.

Foxtons is also marketing a two-bed flat in Wapping at a whopping £7,000 a week as an Olympics let. By contrast, it is also marketing a non-Olympics three-bed flat in Wapping at £1,350 a week.

Foxtons is by no means the only agent listing Olympics rentals. Link Up Properties also has a two-bed flat in Wapping available at £7,000 a week for the Olympics. Knight Frank has a one-bed flat in nearby St Katharine’s Dock as a short let for July and August at £3,900 a week and is marketing a number of rental properties specifically for next July and August.

Such is the concern about sky-high Olympic rent prices that the issue has been raised in Parliament.

Labour MP Chris Williamson, who represents Derby North, asked whether an assessment had been made “of the extent to which landlords have evicted tenants in London in order to let their properties at higher prices during the London 2012 Olympics”.

Williamson also asked whether the CLG minister planned to take steps to discourage this practice.

Replying, CLG minister Andrew Stunell said: “We have received no evidence that landlords are seeking to evict tenants in order to let at higher rents during the London 2012 Olympics. Any landlord seeking to evict a tenant would need to operate within the existing legal framework which entitles most tenants to an initial fixed term of six months, and two months’ notice of eviction.

“That framework would also apply to any new tenancy. Landlords seeking to let properties on a short-term basis only may need to seek planning permission for a change of use of their property from a residential to commercial let.”

Meanwhile, not all agents are keen to cash in on the action, scenting problems such as getting tenants to quit when the Games are over, and whether the taxman might also see gold before his eyes. See the inimitable Bushells blog.
 
http://www.foxtons.co.uk/search?search_type=EL&submit_type=search
 
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