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PRS ‘perfect storm’ as more landlords leave and tenant demand surges

Propertymark says Wales in particular is seeing the effects of the post-Covid boom and landlords quitting the market as rental reforms loom.

Nigel Lewis

landlords window

Market pressures within the private rented sector (PRS) along with English, Welsh and Scottish plans to make tenancies more secure are leading ‘no-where near enough properties available within the market’ as landlords quit.

That’s according to Propertymark. Its latest market conditions report based on member’s reports during January reveals that increasing numbers of landlords are exiting the market, exacerbating the existing shortage of stock while the number of new applicants is increasing – leading to higher rents.

The trade association says its Welsh members reported the most extreme figures with five landlords exiting the market per branch compared to a national average of two.

Branches also reported 313 new tenant applicants each on average compared to a national average of 118, which itself is 50% higher than normal.

Sharp increase

Three-quarters of member agents reported rents increasing which has sharply increased from just over half in December 2021 which prior to January 2022, had continued to fall for four consecutive months.

nathan emerson tenant referencing“Our latest report shows an unprecedented spike in new applicants registering per member branch with a 140 per cent increase in January compared to December,” says Nathan Emerson, Chief Executive of Propertymark (pictured).

“Setting this figure beside the small increase in the average number of new properties entering the market in January, there seems to be nowhere near enough private rented homes available.

“Wales is seeing the greatest number of landlords exiting the sector and interestingly, this could come as no surprise to many agents and landlords

“With several changes on the horizon from the implementation of the Renting Homes (Wales) Act, landlords in Wales will be faced with further regulatory pressure.

“Coupled with the extremely high demand within the sales market in areas across Wales, these could well be contributing to the number of landlords exiting the sector.”

 

February 24, 2022

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