A recent study reveals a significant increase in the demand for private rented sector (PRS) properties, with nearly three-quarters of landlords experiencing a rise in tenant interest. This spike in demand, as reported by the National Residential Landlords Association (NRLA), has tripled since before the Covid-19 pandemic.
The research, conducted by BVA-BDRC, polled nearly 800 landlords and found a record high in tenant demand during the third quarter of this year. This marks a considerable jump from 65% last year and is a stark contrast to the 22% of landlords who noted an increase in tenant demand during the same period in 2019, before the government’s Covid lockdown measures.
The survey highlighted that the West Midlands is currently experiencing the strongest demand, with 76% of landlords reporting an increase. This is closely followed by Wales at 75% and the South East (excluding London) at 74%.
Despite this unprecedented demand, the study also found that one in ten landlords has sold property since July, more than doubling the 5% who purchased property in the same period. Additionally, nearly a third of landlords plan to reduce their rental property portfolios over the next year.
Ben Beadle, Chief Executive of the NRLA, expressed deep concern over the situation. “Would-be renters face a desperate situation as ever-growing numbers seek to access a dwindling number of available homes,” he said. Beadle criticized the government’s tax system, arguing that it favors investment in holiday lets over long-term rental homes. He warns that this imbalance between supply and demand in the private rented sector will continue to diminish the purchasing power of tenants and potentially jeopardize the benefits of the Chancellor’s decision to unfreeze housing benefit rates.
The NRLA’s findings shed light on the current challenges facing the UK rental market, highlighting the need for government intervention to address the tax system’s impact on the availability of long-term rental properties.