According to a recent rental index, rents in England and Wales increased 11% annually as a result of overall tenant demand increasing by 14%, while the supply actually decreased by 7% over the same period. In London, tenant demand is a whopping 11 times the rate of supply.
London, as ever, is off in a world of its own, with new agreed tenancies up 34% annually, with just a 3% increase in supply. However, the rest of England and Wales has seen a 20% in new agreed tenancies, pushing the average monthly rent rate up to £784.
While competition between tenants for rental property heats up, landlord confidence is surging. According to the latest Paragon Mortgages survey, a quarter (25%) of landlords intend to purchase futher rental property in the next 12 months. 68% of landlords said the the strength of tenant demand in their local area was an important factor in their decision to invest.
It is telling that the ratio of tenant viewings to agreed tenancies to fallen from 8.3/1 in May 2013 to 7.6/1 in May 2014, demonstrating that tenants have recognised the need to act fast in the lettings market.