Landlords have reported huge demand for rented property with tenant enquiries reaching a five-year high, the National Residential Landlords Association has reported.

The trade body quizzed its members in England and Wales and 39% confirmed that demand for homes to rent had increased in the second quarter this year – an eight per cent increase on the first quarter.

This surge takes the rental market to its highest level of activity since 2016, the NRLA says, pinning the unusual figure on the relaxation of COVID restrictions and a more buoyant economic outlook.

But the figures mask a trend which is seeing a two-tier rental market developing across particular regions.

In Yorkshire and the Humber, Wales, the South West and the South East over 60 per cent of landlords said that demand for homes to rent had increased.

In stark contrast, just 15 per cent of landlords in Central London said demand had increased in the second quarter of the year, compared with 53 per cent who said it had fallen.

Home working

Landlords say this supports the much-reported desire among tenants in the capital to leave London as home working has increased.

But despite this boom, the NRLA says a significant percentage of landlords have been negatively impacted by the demands of the pandemic on the PRS, with 20% looking to sell rental properties.

Chris Norris (pictured), Policy Director for the NRLA, says: “The evidence is clear that nationally whilst the demand for homes to rent is increasing, landlords are more reluctant to invest in new properties.

“The only losers will be tenants as they struggle to find the homes to rent they need. The Chancellor needs to recognise the harm being done by tax hikes imposed on the sector.”