Research suggests that despite the current economic climate, between the months of March 2011 and March 2012, landlords with properties in central London saw a 3.7% increase in their rental growth, equating to an average rent of £2,430 per calendar month, with properties in the Covent Garden area being in particularly high demand.

The average rental price per square foot for properties in this area is normally between £45 and £55 but some letting agents have managed to achieve more than £60 per square foot and found that properties in highest demand were one bedroom apartments, many of which were being snapped up by tenants from overseas, particularly the United States.

However, it’s not just central London that is experiencing this sudden boom in demand for rental property, in fact it appears that most of the city is experiencing the demand in varying degrees. This is great news for both landlords and letting agents but why is it happening? There are a number of reasons why demand for rental property in London is on the increase and most of these reasons can be put down to the current property market and mortgages.

Even though property prices have slumped and now would normally be a good time to buy, very few can actually afford to do so and, with the increase in mortgage arrangement fees of 25% in the past three years and the average monthly mortgage payments rising by between £100 and £200, the option of renting a property is a much more attractive one.

Those who own a second home also feel it is safer to rent out the property rather than sell at a loss and landlords who were considering selling have opted to continue to let due to the high rental demand. Subsequently, many landlords are now enjoying the highest yield they have seen in over two years due to their substantial rent increases.

Mrs. Coney, who had intended to sell her father’s property, has had no option but to put it on the rental market. The four bedroom house, which is situated in a desirable area of Fulham, was, last year, valued at £1.25 million after extensive refurbishment costing £26,000 was carried out.

Due to the climate it was put on the property market at £999,950 as well as the rental market for £950 a week. If the property sold at the current asking price Mrs. Coney would experience a loss of over £250,000 so she is looking to hold off on the sale for the next couple of years in the hope that the market picks up and, in the meantime, unless a very reasonable offer comes in, will continue to rent instead.

It is predicted that this market will continue to grow and flourish as more and more people opt to rent rather than buy until the market becomes more stable. If this is the case then certain restrictions may need to be put in place to ensure landlords can’t charge extortionate rents but renting property certainly does seem a far more feasible option in this climate.

With such high demand for rental properties it is imperative that a good letting agent is used and landlords will find they can save themselves the excessive fees of high street letting agents by employing the services of an online letting agent.

An online letting agent will advertise the property in question on a range of popular property advertising websites and portals and can even offer full property management packages which include the securing of a tenant, undertaking all the necessary tenant referencing and checks, drawing up the inventory and tenancy agreement and even collecting the rent.

If you are considering renting out a property in the London area and require the services of an online letting agent then visit lettingaproperty.com for more information about finding a tenant online.