Demand slows as agents warn about unsustainable rent ...

The latest market report from Propertymark’s lettings agents suggests the demand is slowing.

The latest data - for March - shows that the average number of new prospective tenants registered per member branch decreased from 89 in February 2024 to 82 in March.

Stock levels tend to fluctuate month on month, and although they increased in March, they remained within established parameters.

However, despite being slightly weakened, demand continued to outstrip supply, with around nine new applicants registered for each available property in March.

The average number of new tenancies agreed marginally increased in March but remained subdued compared to the same period last year.

On the critical point of rental affordability, Propertymark reports: “A small majority of members have reported that rents have remained the same in each
month over the last five months. However, in the same period, a larger proportion of agents have reported seeing rents rise than fall.”

Two other measures were reported by Propertymark agents: arrears reduced in March with members reporting that around 2.5% of fully managed and rent collect/ rent management properties were in arrears, while the average void period increased slightly in March but remained within long-run parameters.

The trade body monthly market snapshot also includes agents’ comments.

This month, Chris Anderson - director of Anderson’s Lettings Agency in Leicester - says: “The continuing rising costs associated with owning leasehold properties is causing landlords financial pressures that are inevitably passed onto the tenants. Continuously climbing rents are not sustainable for many tenants and month on month losses for many landlords, along with prospect of increased landlord regulation and compliance challenges are driving many landlords to leave the sector... less landlords, more tenants, higher rents and so the circle continues.”

And Hilary Breeze of Hilary Breeze Property Management in Kent comments: “The supply of available rental properties is much lower than we would expect for this time of year. This is in part due to a strong uptick in demand for rental properties in March, but also due to fewer properties coming on the market across the board. Even though inflation is coming down, monthly rental prices are staying strong.”