Heightened Demand Amid Supply Challenges

Amidst the dynamics of the rental market, a substantial challenge emerges – a pronounced imbalance between the burgeoning demand for rental properties and their limited availability. Stakeholders participating in the report identified various reasons contributing to this scarcity. Landlords departing the sector, augmented regulatory demands due to the Renters Reform Bill, and the imperative need for property upgrades to meet higher efficiency standards were cited as key factors.

The report highlights a significant trend – 47% of landlords have either sold or are attempting to sell at least one property this year, contributing to a notable shortage of available housing stock. Moreover, the confluence of rising mortgage rates and forthcoming Energy Performance Certificates (EPC) alterations continues to exert considerable influence on market dynamics.


Apprehensions Surrounding Legislative Changes

The recent introduction of the Renters Reform Bill by the government has spurred considerable apprehension within the industry. Notably, the abolition of ‘no fault’ evictions under section 21 and the adoption of periodic tenancies as the norm in England have caused unrest among landlords and letting agents. While certain proposed measures, such as the implementation of a property portal, received relatively less opposition, scepticism persists among some stakeholders regarding these reforms.

Approximately 50% of respondents in the report believe that strengthening section 8 would yield neither positive nor negative effects on the sector. Conversely, almost 50% of landlords and letting agents express reservations about the potential repercussions of rolling contracts.


Gauging the Industry’s Future Outlook

When assessing the future trajectory of the private rented sector, both tenants and industry professionals predominantly harbour reservations. Notably, landlords displayed a notably pessimistic outlook, contrasting with the relatively more optimistic stance among industry suppliers. However, letting agents seemed aligned with landlords’ concerns about the sector’s progress.

The ongoing trend of soaring tenant demand amidst a scarcity of available properties persists. As landlords opt to withdraw their properties from the market, this discrepancy shows no signs of resolution. This indicates that the challenges confronting the lettings sector are poised to persist in the foreseeable future, necessitating strategic considerations and adaptations within the industry to address these ongoing imbalances effectively.