Tenants downsize to cut costs

Landlords of one and two-bedroom properties in Central London are benefiting from a surge in demand, says Cluttons, as anxious tenants downsize in droves in order to reduce their outgoings as the recession bites.

Cluttons estimates that approximately 40% of all tenants who have reached the end of their existing contracts in areas such as South Kensington, Chelsea, Wapping and St John's Wood, are opting for less expensive and often smaller properties. Landlords of larger properties are enticing tenants to stay with rent reductions in the region of 15-20% at contract renewal, but many larger houses and lateral apartments on the river are still proving difficult to let.

Lynn Hilton, Partner for Residential Sales at Cluttons, comments:

"Landlords of smaller one and two-bedroom properties are weathering the storm reasonably well. While their traditional market of new graduate recruits to the City has diminished they are benefiting from a surge in downsizing, as financial workers who are still in jobs but are worried about their future financial security set about reducing their financial commitments."