THE BOSS of London-focused estate agent Foxtons has warned "people are going to have to move" due to a lack of available properties in the capital -with London's business groups saying the city's competitiveness was at risk.

Foxtons boss Guy Gittins told the BBC yesterday that the shortage of rental options is now "dramatic", with prices spiking significantly over the past year.

Paul Swinney, director of policy and research at Centre for Cities, told City A.M. the capital has already seen a "squeeze" on the pool of talent it has been able to recruit from in the last 15 years and that a lack of suitable homes for aspiring professionals is "bad for its economy overall".

He explained:"The difficulty in trying to find accommodation points to a long-running challenge in the capital - it hasn't built enough homes to house the people who want to live here.

"If they [look elsewhere] it'll be bad news for London's businesses," he continued.

Soaring inflation and a hike in utility bills have been blamed for an increase in rents in the past few months, however Gittins said that a disparity between supply and demand was the real issue.

"The main issue is not affordability for the majority of the market - it's the stock issue." £ CONTINUED ON P2

CONTINUED FROM P1 Jonathan Seager, policy delivery director at BUSINESSLDN, told City A.M. its "vital" the capital can deliver a mix of homes across tenures and price points so that housing becomes more affordable to all Londoners, "helping to retain talent already in the capital and attracting it".

It comes as a study by charity Trust for London showed that more than one in five people living in inner London are aged between 25 and 34 - with many traditionally flocking to the capital and inhabiting in flat shares to better their careers. The rapid decline of supply can be seen in data shared with City A.M. by house sharing platform Spareroom which shows that the average price for a room in London has spiked almost £200 per month in a year.

Matt Hutchinson, Spareroom director, said: "The last 12 months has seen rents across the UK hit record highs and, unless new supply comes into market over the coming months, it's hard to see how those rents will come down."

(c) 2023 City A.M., source Newspaper