London's European renters are having a 'soft rebound' after the post-Brexit exit
Before Brexit, one in three London renters came from Europe.
By July 2022 that number had dropped to just 14 per cent of tenants in the capital who were European citizens.
But the numbers have begun to recover over the past year. Now one in five renters are European, accounting for 20 per cent of tenants signing new lease agreements between 2023 and 2024.
Property technology Goodlord crunched the numbers on tenancy agreements to get a sense of how Brexit has effected the London rental market.
“We saw an incredibly sharp drop off in the number of Europeans signing tenancy agreements in London during the years immediately after the Brexit vote,” said Oli Sherlock, managing director of insurance at Goodlord.
“As the formalisation of Brexit crept closer, numbers continued to decline. This steady drop continued through the pandemic and as free movement for EU citizens came to an end.”
“We saw an incredibly sharp drop off in the number of Europeans signing tenancy agreements in London.”
Oli Sherlock, Goodlord
The UK voted to leave the European Union in 2016 and formally left in 2020. EU citizens now require a visa to live and work in the UK and have lost their automatic right to rent here.
London’s economy shrunk by £30 billion as a result of Brexit, according to a politically controversial report from City Hall, with 300,000 less jobs available in the capital.
House prices have continued to rise across London, but prime property prices have declined in the parts of London that traditionally attracted wealthy European buyers and renters.
“We’re nowhere near the volumes we used to see,” said Sherlock. “But there’s definitely been a soft rebound in Europeans making London their home.”
European tenants will now have to contend with rents that have risen sharply post-Brexit, although demand for rental homes has begun to drop as more first-time buyers make it onto the property ladder.
“This may be the result of our continental colleagues becoming more au fait with the visa process.”
Oli Sherlock, Goodlord
While European renters are definitely returning to the capital, the demographics have shifted, Goodlord reports.
Prior to Brexit, Italians made up the largest cohort of Europeans renting in London. Now Romanians have become the biggest group of European renters.
Sherlock deduced that there could be several reasons for Europeans returning to London.
“This may be the result of our continental colleagues becoming more au fait with the visa process, as well as the number of tech firms actively recruiting for global talent in recent months,” he said.
“It will be interesting to see if these numbers keep increasing, or if we’ve hit the European ‘ceiling’ for the capital’s rental market.”
