The rental markets in London, Amsterdam, and Paris opened in 2023 with a mixed perspective. Prices in London and Paris rose, while rents in Amsterdam fell for the second consecutive month. New and pending legislation on the continent is expected to have an impact on an already limited supply of properties.
London Rental Market Latest
London has been crowned the ‘coolest city in which to live’ in the UK by Nomads Nation. Insightfully, the poll was conducted among an audience largely comprised of professionals who work remotely, with the capital being praised for its gourmet scene, culture, free museums, and diverse range of activities. With London remaining such a popular professional hotspot, it’s no wonder that rents continue to perform exceptionally well. The Deposit Protection Service‘s most recent data analysis demonstrated how strong the city’s lettings market is. Rents in London increased by 11.59% (£160) from £1,381 per calendar month (pcm) to £1,541 pcm between Q4 2021 and Q4 2022. The astonishing rise even outstripped the country’s rate of inflation.
Average Monthly Rents in London
A continuing lack of supply in London meant that three out of the four properties Klippa tracks were more expensive to rent in January ’23 than in December ’22 – one markedly so. Only a one-bedroom apartment in London’s suburbs fell in cost, from €1,638.61 pcm to €1,618.66 pcm. Those with their sights set on a three-bedroom apartment in London’s city centre had the biggest price shock, with rents rising from €3,774.05 pcm to €3971.93 pcm in just four weeks. There was a more modest rise attached to a one-bedroom apartment in the heart of London, climbing just one euro to €2,275.76 pcm. A three-bedroom apartment outside of London’s centre rose from €2,681.67 pcm to €2,737.77 pcm.
Amsterdam Rental Market Latest
The Netherlands’ weakening sales market has been quantified with a set of new figures. The country’s most marked house price drops were seen in Amsterdam’s IJmond and Haarlem regions, where prices fell by 9%. Property experts are, however, calling this a ‘small correction’ against a backdrop of large annual increases and historically high values. This, in turn, may encourage landlords to sell up and cash in – especially in light of a new announcement by Hugo de Jonge. The Housing Minister wants to extend rent controls to cover more of the mid-value rental market, while also making it harder to achieve more points. At present, rent controls only apply to rentals with less than 142 points. de Jonge would like this threshold raised to 187 – which is equivalent to a rent of around €1,000 a month. The change, scheduled to come into effect in January 2024 and applicable only to new lettings contracts, will see 90% of Dutch housing stock covered by rent controls.
Average Monthly Rents in Amsterdam
The trend of declining rental values continues in Amsterdam. January was the second consecutive month when all four properties that Klippa tracks became cheaper to rent. Rents for three-bedroom homes fell the most in value. A three-bedroom apartment in Amsterdam’s city centre has dropped from €2,793.48 pcm to €2,604.29 pcm in four weeks. Moving outside of the city centre, and a three-bedroom apartment in the suburbs has fallen below the €2,000 pcm mark to €1,972.60 pcm. Improved affordability can also be found when looking at smaller properties. A one-bedroom apartment in Amsterdam’s city centre is now €1,620.77 pcm, down from €1,682.22 pcm. A one-bedroom apartment in the suburbs also dropped in cost, from €1,442.78 pcm to €1,371.68 pcm
Paris Rental Market Latest
Paris’s rental properties are now subject to new energy efficiency laws, with G+ rated rentals that consume over 450kWH per square metre per year being removed from the lettings market. The properties left are not immune from being axed either, as minimum energy efficiency standards are set to toughen further in 2025, 2028, and 2034. Worryingly, the cost of eco improvements may jeopardise the investment in greener rental stock. The Confédération de L’artisanat et des Petites Entreprises du Bâtiment claim the cost of materials ended 2022 an average of 25-29% higher, with the general price of property improvement and maintenance work in France rising 9.9% during 2022. These rising costs may force landlords to sell up instead of improve, leading to a new supply crisis.
Average Monthly Rents in Paris
Rents in Paris during January mirrored those in London, with one property type falling in cost and the other three rising. The fluctuations were minimal, repeating the stability noted in December 2022. It was a three-bedroom apartment in the Paris suburbs that became marginally cheaper to rent in January – falling from €1,948.11 pcm to €1,937.65 pcm. The most prominent rent rise was attached to three-bedroom city centre apartments, with a jump of €60 to €2,910.38 pcm. A one-bedroom apartment in the centre of Paris rose in cost from €1,289.00 pcm to €1,291.18 pcm, while a one-bedroom apartment in the city’s suburbs was fractionally more expensive, rising from €936.44 pcm to €947.44 pcm.
Need to Secure a Rental Property?
Klippa Relocation has established agents working across London, Amsterdam and Paris. We have enviable relationships with each city’s leading real estate agents and property finders, so please get in touch if you need help with the local rental market.
*Average monthly rental figures, expressed in Euros & taken from Numbeo, 27th January 2023