Lettings supply still low as online agencies fail to ...

A market snapshot of lettings in the second quarter of this year has described the supply shortage as “massively under-performing”.

The comment comes from property consultancy TwentyCi, which issues a quarterly homemaker report covering lettings and sales.

It says that by the end of the quarter - so the end of June - new instructions were down by over 27 per cent. The volume of lets agreed was also down by 18 per cent.

The average rental asking price across the UK is now £1,520 which represents an increase of 10 per cent from the same period in 2019.

A spokesperson for TwentyCi says: “With interest rates rising and energy costs rocketing we would expect to see landlords continue to pass these costs on to tenants through rent rises, suggesting the lettings market will continue to be depressed throughout 2022.”

The snapshot also gave an insight into the penetration of online agents, covering both sales and lettings.

The market share of the Hybrid/Online agents in Q2 2022 stands at seven per cent representing a small increase quarter on quarter, but still significantly down from the high of eight per cent back in 2020.

Purplebricks, Yopa and Strike remain the dominant brands representing nearly 70 per cent of all Hybrid/Online activity.

TwentyCi says the market share of the hybrid/online agents remains polarised to the lower value properties, a situation that remains unchanged from previous periods.

The failure to be adopted by sellers and landlords of higher value properties will inhibit the ability of these agents to establish significant market share in London and the South East, says the snapshot, where the property value and density of housing is greatest.

The market share by region confirms the challenge faced by these agents in breaking into those regions of the UK with higher property values. Market share in the Yorkshire and the Humber currently stands at almost 12 per cent, whilst in the East, South East and South West of England market share falls to four per cent.

And the consultancy asks: “With a large number of executive changes at Purplebricks, the question remains will 2022 bring the seismic shift in market penetration that was once lauded?”