New research revealed on Friday that, on average, boroughs with a tech giant in the neighbourhood have an average rental cost that is 44% higher than the London average.
Howsy, the lettings management platform, looked at the current cost of renting in boroughs that have Google (NASDAQ: GOOGL), Microsoft (NASDAQ: MSFT), Amazon (NASDAQ: AMZN) and Facebook (NASDAQ: FB), in comparison to the London average.
Westminster, which is home to Microsoft and Facebook, is the highest with an average monthly rent of £2,838. This is 64% higher than the London average.
Howsy also said that, on average, rental prices in these boroughs have seen a 4.7% increase since the companies moved there, compared to an increase of 1.7% across London as a whole.
Howsy’s research cites Google’s move to Camden in 2016 as the “most notable” example, where rents in the borough have increased by 9.2% since the company moved there. This compares to an increase of 0.8% across London as a whole.
“It’s great to see such big names committing to London, and the wider economic benefit they bring through the provision of jobs, investing in their workforce and the surrounding area is a big plus,” Calum Brannan, Founder and CEO of Howsy, commented on the research.
“However, the downside of so many additional people being drawn to the rental market is this greater demand causes a spike in rental prices. This creates a further financial obstacle for those living in the area without the benefit of a robust tech-based salary and can see many existing residents drive out,” the Founder and CEO continued.
“This new age of tenant also comes with an evolved level of requirements for UK landlords to deal with and as we become a nation that is connected on a 24/7 basis, tenants expect an agent or platform that can provide such a service.”