Tenant demand in the private rented sector remains at the highest levels seen for five years, according to the Association of Residential Letting Agents.
Two thirds of the letting agents in prime central London report they have more tenants than there are properties available to rent. This is echoed throughout the South East, where the same lack of property is reported by 57 per cent of the letting agents.
In the rest of the country, 37 per cent are reporting rental property shortages.
In prime central London, the increase in demand over supply has increased thirteen fold in the past five years.
In the rest of the South East, demand has risen six fold and has remained relatively static in the rest of the country.
ARLA head of operations Ian Potter says: “This peak demand should come as no surprise. It has been driven up by the many competing demands for rental accommodation and now we have softening house prices. Softening in the sales market is always a driver of further demand in the rental market.”
Rent levels throughout London and the South East are considered to have risen very significantly, with the majority of letting agents reporting increases.
Elsewhere in the country, up to 54 per cent of all letting offices report increased rents achieved.
Tenants continue to stay in properties for well over a year, regardless of the length of their initial agreement which is commonly for six months. Void periods remain at well under a month. This decline in the length of time properties are empty has been declining steadily from an average of nearly five weeks.
Potter adds: “These latest figures confirm that the private rented sector will once again be the safety valve for a housing market worried by the current financial uncertainties and the softening of house prices. It is the rental market that houses the massive numbers of immigrants, the increase in single households and more students in higher education.”
The proportion of investment landlords who are selling has fallen from 21 per cent to 16 per cent and buying from 16 per cent to 11 per cent.