News that the London Property market for rentals has suffered a noticeable downturn in 2009 will come as a welcome surprise to Londoners who have felt out-priced in their own city over the last few years. As fewer companies attract fewer overseas workers due to the global economic crisis, demand for high-end, core and central London properties for rent has declined significantly in the first few months of the year.

Areas renowned for their luxurious and expensive properties, such as Tower Bridge, Kensington and Knightsbridge, have witnessed an astonishing decrease in rental costs, up to 16% since the beginning of the year. Rental management companies have reported an increase in the interest from UK-based applicants from Greater London and beyond, and a corresponding decrease in foreign interest in London property.

This trend - showcasing a 75% increase in prime London property rental viewings - has meant that prospective renters and property buyers are taking more time to choose their ideal abode, indicating a shift to a consumer-led market price, as opposed one dictated by the property owners. This is actually an unprecedented scenario for Londoners over the last decade, which has generally seen a relentless increase in the cost of renting.

"Existing UK employees now often have to work longer hours with a post-credit crunch reduced workforce, with many people opting to live closer to work, which is now a possibility due to market conditions pushing down prime London rents. This was previously impossible with supply very much in demand and prices at an all-time high", comments Lesley Cairns, Head of Residential Lettings of Hamptons International.

The fall in overseas corporate workers has also affected property for rent in the countryside. Often cast at the luxury end of the rental market, it has for years been the preserve of senior executives in the UK, typically staying for 2-5 years. However, contemporary distrust and lack of confidence in the global financial market has meant that UK firms are increasingly unwilling to bring in key personnel from abroad.

It is difficult to predict just how long this trend will last- but until then, Londoners especially should be happy about lower rental costs!  Iwona szymanska