This week’s exclusive interview looks at the rental arm of one of London’s largest and best-known housing association, Notting Hill Housing, and speak to Folio London’s head of market rent Lizzie Stevens about how the new homes supply in the capital is helping those who can’t afford to buy.
Hi Lizzie, please tell us a little about yourself and Folio London.
My career in the industry began at an estate agency, where I worked in the lettings department. I then moved on to become a lettings manager for a private developer, and subsequently, managed a portfolio of properties for a private landlord in Battersea. This gave me experience in residential and commercial property management, and led to my job at Folio London, which I have headed up since 2014.
Folio London is the private rental arm of Notting Hill Housing Group. Members of ARLA and CIH, Folio London owns and manages apartments and houses across the capital, including new build properties, helping renters find a home that’s right for them.
Is it true to say that private rented sector (PRS) has boomed in the last two or three years, especially in London?
Yes, definitely. There will always be a need for people to have places to live, and with house prices through the roof in London, we have to be realistic and accept that owning is becoming less achievable – as well as less desirable for those with more transient lifestyles.
Renting is becoming the norm for so many, with lots of ‘Generation Rent’ choosing not to buy. The number of people entering the private rental sector is increasing, but as they’re not leaving it to buy like they used to, so more and better quality homes are needed and choice of location need to be offered to this growing, discerning market. We have seen just in the last few months the crippling effect the government’s new policies have been on the buy-to-let market, putting many individual private landlords in a tough spot financially, so with a slowdown in that market, it’s up to institutional landlords, like Folio London, to bridge the gap and provide great value, service and a higher quality of property.
How has the market for London rental properties been in 2016?
For us, very fast-moving. We’ve seen far fewer empty properties, as they’re being snapped up quickly, which proves how much of a demand is there for rental homes in London. People are weighing up the cost of buying a home further out of the city and commuting versus living in it and paying slightly higher rents to enjoy the lifestyle – unsurprisingly, many are choosing the latter.
In addition, the uncertainty around Brexit has left many buyers nervous, as opposed to renting, which is much more stable a tenure right now, and more closely aligned with incomes. As a result, we’re finding that the outlook for rent is stronger than that of buying.
How do the people you deal with feel about renting - are they disappointed to not be able to buy, or do they see positives to being in the rental sector?
People can still be disappointed by not being able to buy – the view of getting on the ladder is bleak, but it is still the ultimate goal for so many people.
However, how much a buyer would have to sacrifice in order to accomplish their dream is leaving people disillusioned. They are quite happy with their lifestyle and the area in which they live, and don’t want to give that up to save for a deposit or repay a large mortgage. Plus, with the quality of the products now available, and the numbers of new build rental homes coming onto the market, tenants don’t have to compromise on location or property type like they do with buying.
Are the new build homes you're renting out offered at a premium rate, and do people see the benefit of new build at that price?
Folio London’s properties are offered at market rate – we must remain competitive – but certainly the new developments we are launching can have extra benefits for residents such as on-site gyms, concierges, car parking spaces, so we have to factor that in to the monthly rent.
We build and let homes in such large quantities that we can be competitive and offer fair market prices – such as Royal Albert Wharf where we are about to launch 73 new apartments in January. There’s so much choice in the private rental market that it wouldn’t make sense to price ourselves out of it – we don’t want vacant properties, and we recognise that cost is one of the largest factors when choosing a rental home.
What sort of specifications can people expect from one of your new homes?
Folio London has an extensive portfolio of rental properties which come in a range of layouts and sizes, from one-bedroom apartments to three-bedroom penthouses, housing everyone from young professionals to growing families to downsizers.
Our properties are built to modern standards of efficiency. Tenants can also be assured of a high-quality specification, with contemporary fitted kitchens inclusive of energy-efficient, A-rated appliances, and tiled bathrooms including quality suites with bath/showers and basins. In many cases, the specification of the rental properties does not differ too much from that of a home for sale at the same development.
Where are you seeing most activity at the moment?
This is really difficult to answer, as we build a wide variety of homes across London. Most of our stock is in the outskirts of central London, Zones 3 and 4, where there’s better value and lots of regeneration happening.
We are finding that our west London properties, in places such as Ealing and Chiswick, are gaining a lot of interest, but that could also be attributed to the large volume of homes we have there. South-east London is seeing a lot of activity too, around Lewisham and Catford for example, where properties are still great value for the proximity to central London. East London, particularly the Docklands, is also on the up, as there is so much redevelopment going on. We’ve got two developments launching in 2017 in E16, which we are confident will go pretty quickly – East London is thriving and we expect that to continue for some time.
What's in the pipeline for Folio London over the next 12 months?
In 2017, we’ve got a number of new schemes launching and by the middle of the year, we expect to have almost 950 rental properties on our books! For example, at Coral Court in Arnos Grove we will have over 40 new apartments, and at Royal Albert Wharf in Royal London Docks over 70, both launching in January – what a great start to the year!