Demand for rentals grows as number of prospective tenants continues to rise

Demand from prospective new tenants rose in February for the second month in a row, according to new figures.

Half of letting agents saw landlords increasing rent in February, while the number of properties managed per branch fell.

The findings are revealed in the latest monthly Private Rented Sector report from ARLA Propertymark.

The report reveals that the average number of prospective new tenants registered per branch continued to rise in February to 82, from January’s figure of 81.

This remains the same as February 2020, year on year, but is a big increase on the previous February figure of 65 in 2019.

Regionally, the West Midlands had the highest number of new tenants per branch with an average of 126, with the East Midlands having the second highest at 123 new tenants.

Northern Ireland and the Isle of Wight both recorded the lowest number of new prospective tenants, with an average of 26 per branch in February.

Rent increases

The number of tenants experiencing rent increases jumped in February, with half (49%) of agents seeing landlords increasing rent, compared with 39% in January – up year on year from 40% in February 2020.

The number of tenants successfully negotiating rent reductions remained the same at 2% in February. Year on year this is the same as during February 2020, when the figure also stood at 2%.

Housing stock

The number of properties managed per letting agent branch fell for the third month in a row from 196 in January to 195 in February.

Regionally, the North East had the highest number of properties managed per letting agent branch with a figure of 284. However, rental stock was the lowest in London with an average of 94 properties managed per branch.

The number of landlords selling their buy-to-let properties remained the same for the fifth month in a row, at four per branch in February. Year on year this figure is slightly lower than the February 2020 figure of five.

Mark Hayward, chief policy advisor at ARLA Propertymark, said: “Today’s report demonstrates that the rental market continues to show no sign of slowing down, as demand for rental properties rose yet again in February.

“Letting agents have continued to support landlords and their tenants throughout the ongoing Covid-19 difficulties, and it is essential that tenancies are maintained wherever possible to ensure rent keeps flowing.”