The South London Lettings Picture: December 2025

I can hardly believe I’m saying this, but welcome to December!

Normally, as we tip over into this twelfth month, people tend to expect the lettings market to curl up with a mince pie and relax in front of the fire.

But, just as has been seen in the residential sales market this year, the pattern isn’t quite behaving as normal.

In and around Streatham, Balham, Tooting and Colliers Wood, we’re not seeing a dead market – we’re seeing a selective one, perhaps, but also in these few days since the Budget announcement, we are seeing wider reports about a more active market than we’d normally expect.

So what’s going on – and what should local landlords be doing about it?

Rents High but Rising More Slowly

Zooming out, the national picture is one of high but stabilising rents.

• The ONS shows UK private rents up around 5.5% in the year to September 2025, with the pace of growth easing for nine consecutive months.
• Rightmove reports that average asking rents here in London hit a new record of around £2,700 per calendar month this quarter, even as growth has slowed as the market finds a “steadier rhythm”.
• HomeLet’s latest index has UK average rents dipping very slightly month-on-month in November, suggesting a gentle plateau rather than a fall – but already, in these first few days in December, we have seen rents increasing again (there may be a reason for that – read on!)

Zoopla’s rental market reports tell the same story: rental inflation is running at roughly half the pace we saw a year ago, as affordability finally bites and tenant demand and available stock move back towards balance – but it is still going up, not dropping. It is just going up a little more slowly – and that might mean a bit more stability for tenants.

For the landlords we deal with, our advice is: rents are not crashing, but the days of double-digit annual increases are behind you for now.

How Does This Feel on the Ground in Streatham Hill and Surrounding Districts?

On the ground, it looks like this:

• Well-presented one- and two-bed flats near good transport – Streatham Hill, Balham, Tooting Bec, Colliers Wood – are still attracting very strong, immediate interest.
• Properties that are tired, overpriced, or inflexible on move-in dates are sitting longer and often need reductions or incentives, despite a buoyant market.
• Family homes with gardens remain in demand, but tenants have been pushing harder on value: they’re comparing commute times, local amenities and even energy efficiency before committing.

Urgency has cooled a little, but serious, motivated movers are still out and about. The tenants out viewing in December are more likely to be putting offers in – something is driving them to view, and many will be looking to tie something up ‘so they know it’s done’ before their Christmas break – especially if they are travelling away for Christmas to see family.

As for tenants, if you are in need of a new home, don’t make the mistake of thinking it all happens after Christmas. Just on Rightmove alone, there are 165 properties currently available to let in Streatham and Streatham Hill, 156 available in Balham, 268 in Tooting, 98 in Colliers Wood…

There’s plenty of choice, and you might just get in ahead of others who are letting the  Christmas countdown get in the way.

Affordability: Still Tight, But Less Brutal

Tenants have been through the wringer in recent years, particularly in London, and that includes around Streatham Hill and other areas locally in the south-west of the capital. Rents have risen faster than wages – in fact, for much of the post-pandemic period – and many households have trimmed everything else in their budget just to stay put.

There is some good news for stretched tenants:

• ONS data shows rental inflation slowing consistently through 2025, even as absolute rent levels remain high.
• At the same time, wage growth has been stronger than expected, as reported by the OBR in October.

Broader economic data suggests households are feeling slightly more secure than a year ago. Figures from the Black Friday-Cyber Monday weekend showed spending up by around £4 billion compared to 2024 – an indicator of consumer confidence. And one thing that did spell good news for many tenants in the Budget – or, in this case, a pre-Budget announcement – is that the minimum wage has been increased.

In practice, that means:

• More tenants are able to pass affordability checks.
• We’re dealing with fewer panicked moves triggered by sudden rent hikes as tenants find they can shoulder it (they don’t like it, but they prefer to do so than move).
• Tenants are nevertheless proving to be more price-sensitive on new listings and more inclined to negotiate.

For landlords, this may be an opportunity to think about long-term occupancy rather than squeezing every last pound out of the monthly rent. The 2% hike in tax on landlord’s rental profits may be responsible for the flurry of rent price increases online that have occurred in the past week, as mentioned earlier.

It is no surprise to see it, but if landlords are considering it we would still urge them to stick to sensible market values, and especially to think long term when choosing tenants.

Yields, Mortgages and Reforms Landing in 2026

From a landlord’s perspective, two big factors are shaping decisions this winter:

1. Borrowing costs
   Financial markets are expecting further interest rate cuts into 2026, after a period in which mortgage costs peaked and then started to drift down. That’s already feeding through into more competitive buy-to-let products compared with late 2023–early 2024. It is worth speaking to an experienced broker now, and keeping pace with what happens when the Bank of England next meets on December 19^th.
2. Returns and yields
   Rightmove data for 2025 shows that a third of private rental properties nationally are located in London, and that the average yield for landlords here is 5.7%. That will surprise many landlords. It is in fact lower than many regions, but still respectable when considering capital values and strong underlying demand. But, with rent yields at 8.1% in the North East, many younger landlords are looking further afield when planning their portfolios – thus reducing rental supply in London over time, but at the same time increasing tenant demand, pushing up rents in the process and delivering greater yields in the longer term, whilst still having that benefit of London real estate capital growth.

With the first phase of the Renters Rights Act set for May 2026, landlords are rightly thinking about:

• Section 21 being removed and what that means for regaining possession
• Stronger standards around property condition and management
• An end to fixed term tenancies
• The increased importance of robust referencing, clear communication and excellent record-keeping

December and January are the perfect time to get your house in order – sometimes literally.

Void Periods and Stock: Why Presentation and Pricing Matter

Despite talk of the market “normalising”, the flow of new rental homes onto the market remains tight. Rightmove’s Q3 2025 rental trends report highlights that the pace of new listings is still lagging behind rental demand in many areas, helping to keep rents high.

In South London, that means:

• Void periods can still be very short if the property is correctly priced and properly marketed. At Your Home Managed, I can’t think of an example where a property has been listed for more than a matter of a couple of weeks before finding a tenant, when our advice on price has been taken and the property presented well.
• Where we do see longer voids, it is almost always down to a mismatch between rent level and condition, or a rigid approach to tenants and terms – something that will become harder and harder for landlords to dictate as the Renters Rights Act kicks in.

A professional clean, even minor cosmetic upgrades, and a realistic rent that reflects current market movements can make the difference.

What Should South London Landlords Do Now?

If you’re a landlord in Streatham, Balham, Tooting, Colliers Wood or Clapham, or indeed any neighbourhoods nearby in this section of south-west London, here’s our December/January checklist:

• Review your current rent
  Are you competitive against similar properties locally, given that rental growth has cooled? Holding out for yesterday’s headline number could cost you weeks of void. But if you are lagging behind, correct it now, or you may struggle to increase to market value over time with tenants in place.
• Play the long game on rent reviews
  Conversely to the above point, a fair, modest uplift – or sometimes even a “hold on increases” for a great tenant – can be smarter than forcing a move and gambling on the next tenant’s reliability.
• Use this window to get compliance-ready
  With big changes due now under the Renters Rights Act, now is the time to check certificates, improve EPC ratings where viable, and tidy up paperwork and processes.
• Think strategically, not reactively
  If you’re considering exiting or expanding your portfolio, base that decision on yields, borrowing costs, and your long-term goals – not just on headlines or emotion.

How Your Home Managed Can Help

At Your Home Managed, we’re not yet ready to wind down for Christmas. We are:

• Advising landlords on realistic, data-backed rent levels
• Negotiating rent increases that work for both landlords and tenants
• Lining up marketing, compliance checks and refurbishment plans for a busy Q1 2026

If you’d like a straight-talking conversation about your property – whether it’s empty now or coming up for reletting in the next few months – we’re here, we’re local, and we are on your side if you believe in delivering quality accommodation in a fair way.

Get in touch, and let’s make sure your South London rental is ready for whatever 2026 brings.