Written by Mark Stroud
For most, the Olympic Games means a 16-day celebration of sport as the greatest spectacle on the planet comes to Britain. However, London 2012 also brings with it a number of implications for the capital’s property market – for some welcome, but others, very much unwelcome.
It’s no surprise that many landlords are taking advantage of the increased demand for room lets ahead of the Games. For them it’s a golden opportunity to make some quick cash with fans willing to pay a premium for a place to stay near the Games’ sites.
Many landlords have hiked their rental prices by five or six times the normal rate for the period of the Games and some in east London, home of the Olympic Park, by as much as 20 times, according to media reports.
One lettings agent described the increases as a simple case of ”supply and demand”, but a number of property experts suggest it’s a move that could end up costing landlords money, particularly if they’ve evicted an existing tenant to do so. They argue that a potentially lucrative short-term let isn’t worth losing a reliable, corporate tenant for and having to pay the costs associated with re-marketing the property.
And what about the tenants? One day you’re paying £600 per week for a house share in Whitechapel and the next the landlord is threatening to evict you unless you cough up £3,000 per week. Homeless charities have condemned the ”greedy” landlords taking advantage of the high demand for homes to evict tenants. They say rents are simply unaffordable for Londoners living in Olympic boroughs and claim the problems will remain long after the Games have left town.
But has the demand for short-term lets been exaggerated? London tourism chiefs expect the Olympics to attract around a million people to the capital in the form of spectators, journalists, businesspeople and Games officials. That’s on top of the 1.5 million tourists London sees in a typical August and all will require somewhere to stay.
With London hotels fully booked well in advance of the Olympics rooms to rent are expected to be scarce. For some time, there have been stories of an inevitable last-minute scramble to secure short-term rental deals; even of people prepared to pitch tents in gardens.
It’s not just landlords who expect to cash in on the influx of tourists. Large numbers of locals have decided to leave the capital for the duration and rent out their properties. However, as the Games draw closer, it is being claimed that many landlords have jumped the gun by hiking prices and evicting tenants and that the rush for short-term lets won’t materialise.
Some estate agents have warned London’s rental market has become flooded, that many properties will remain un-let and that, contrary to belief, supply is actually outstripping demand. One agent even commented that ”landlords are outnumbering tenants”.
Landlords are faced with another problem. Many are looking to let their properties for at least two weeks but are finding substantial numbers of tourists only want to book three or four nights.
Regardless of the pros and cons, it’s clear the Olympic Games will see a dramatic increase in short-term lets and have a significant impact on London’s property market.