Tripled Rents Dent Olympic Bonus for London’s Landlords
Visitors to London’s Olympic Games can stay in a three-bedroom duplex with a steam room near the city’s exclusive Russell Square for 9,995 pounds ($16,000) a week. It’s one of more than 30 offerings by property broker Hurford Salvi Carr Ltd. that haven’t attracted any takers.
Londoners are trying to rent their homes to sports fans during the games for more than three times the typical rate, according to brokers and website listings. With 92 days left before the opening ceremony, they’re struggling to draw guests willing to pay that much.
“We’re still waiting for the demand to emerge,” said Angela Kelly, who helped set up two Olympic contracts as Hurford Salvi’s rental manager. “Maybe there will be a last-minute scramble.”
About 320,000 visitors will converge on the U.K. capital during the Olympic and Paralympic games from the end of July to early September, where they will compete for about 140,000 hotel rooms, according to state-funded tourism website VisitBritain. London homeowners began listing properties for the Olympics as early as 2010 as a recession and the biggest government budget cuts since World War II led to job losses and falling disposable income.
The cost of a typical London hotel room during the Olympics has more than doubled, according to travel website Hotels.com. The city will attract more visitors than previous games in Europe, such as Athens and Barcelona, a study by Oxford Economics found.
Londoners, sensing a squeeze on accommodation, increased rental prices by as much as five times the typical rates, according to Jane Ingram, head of the rental unit at broker Savills Plc. People offering low-budget alternatives may have more success during the games, she said.
The number of journeys on the city’s subway, bus and train network will rise by 25 percent to 15 million a day during the games, according to Transport for London. It urged commuters to the Canary Wharf financial district, less than 3 miles (5 kilometers) from the Olympic stadium, to choose earlier or later travel times.
Hundreds of homeowners are circumventing real-estate brokers by advertising on websites like campinmygarden.com, Gumtree.com and Craiglist’s London to advertise space on couches and in backyard campsites to Olympic tourists only to find demand lacking.
Andy Crawford, a sales trader for Cantor Fitzgerald Europe, has had no success helping a friend rent three properties that overlook the Olympic Park. The properties include a two-bedroom residence offered for 11,280 pounds for 30 nights.
“I’ve had nothing back,” Crawford said by telephone. “He believes that there’s going to be a very late rush of people trying to get properties because people aren’t sure of what events they are going to get.”
London Olympic officials are releasing about 1 million more tickets early next month for events such as the U.S.-North Korea and Great Britain-Brazil women’s soccer games, according to London 2012’s website.
Interest in house and apartment rentals during the Olympics is “fairly non-existent,” said Matthew Lawrence of broker Spencer Thomas Estate Agents Ltd. The company is advertising a three-bedroom house in a former Victorian stable block on its website for 6,000 pounds a week.
Hamptons International, a London based broker trying to find tenants for more than 500 landlords during the games, recommends that owners limit increases to three times typical weekly rents, said rentals director Glen Ford. Hamptons wouldn’t disclose the number of Olympic rentals it has arranged.
“Demand is reasonably slow,” Ford said by telephone. “We’re entering a stage now where I thought there would be a lot more interest.”
To contact the reporter on this story: Chris Spillane in London at firstname.lastname@example.org.
Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.