The UK property rental market is shrinking drastically, leading a new report to warn rents could be driven up.
The outnumbering of prospective tenants to rentals may be partly due to pandemic-born hybrid and remote working which have allowed people to choose locations without thinking about the office commute, the report, by Propertymark, the trade body for estate agents, said.
According to the report, the average number of properties a estate agent branch in the UK reported it was currently advertising for rent decreased from 30.4 to just 15.6 between March 2019 and March 2022, revealing a significant reduction in places available for renters to live.
During the same four-year period, the company found that 94 per cent of landlords who removed their property from the rental market did so to sell it.
Propertymark found that London letting agents overwhelmingly reported that the number of investors buying properties had decreased over the last three years.
However, for the rest of the UK, there was no similar consensus as to whether investors buying properties has increased, decreased or stayed the same.
Nevertheless, Nathan Emerson, Propertymark’s CEO, said the company’s research “presents a worrying picture for private renters”.
He said: “The number of properties available to rent has been diminishing with a large portion of landlords choosing to sell their properties. A lack of property is the root cause for rent increases and rising figures on social housing lists.
“We know from our qualitative research that the most common reasons for landlords to choose to sell their properties and no longer provide homes are around risk, finances and viability.”
According to the company’s research, over half of rental properties sold in March this year alone did not return to the private rented market.
“Landlords and letting agents have been the subject of extreme legislation changes as the UK Government tries to improve the sector,” Mr Emerson said. “However, without a middle ground, these changes are actually proving detrimental to those they are supposed to protect.
“Sadly we do not see this improving as the sector braces itself for more changes within the anticipated Renters’ Reform Bill and upcoming energy efficiency targets.”
Propertymark surveyed 443 agents working for businesses with a combined total of over 4,000 branches across all four UK nations.