Rrightmove says "Tenants face both huge competition for limited stock, as well as rising household running costs".
The battle for rental homes is at its 'most competitive ever' as a lack of supply and huge demand sends monthly costs soaring. "There has been a sharp rise in asking rents, reaching more than £2,100 a month in London alone, amid a critical shortage of available homes", Rightmove says.
The rental market has seen a surge in tenants looking for 'all bills included' tenancies while those who can are staying put to avoid 11% hike in rent in their next home. This is down to a combination of factors, including high demand from people who did not move during the pandemic, along with tenants staying put for longer in a rental property. Its latest figures reveal that one in five landlords have seen their tenants staying put for longer with 63% of tenancies lasting two years or more and only 21% staying less than 12 months.
Acrosss Great Britain, tenant demand is up by 6% and the number of available rental properties is 50% lower than this time a year ago. This time last year, the number of available properties in London has risen by 19% compared to 2019, as London temporarily fell out of favour with renters. Now, demand is up by 81% and avilable rental properties are down by 47% in London compared to the more normal 2019 market.
The results of this ongoing mistach between tenant demand and the properties available to rent means that tenants looking for a new place to move are being faced with the most competitive rental market that Rightmove has ever recorded.
There are more than triple of the amount of tenants enquiring as there are rental properties available, meaning a high likelihood of landlords being able to choose between multiple suitable tenants.
Despite the mismatch of tenants enquiring and rental properties available, there are some positive signs of more property choice. The number of new rental properties coming onto the market rose by 5% in March 2022 compared to January 2022, and 16% compared to the shorter month of February 2022.
As asking rents increase across Great Britian, with nine regions recording a more than 10% rise in asking rents compared to last year, demand is growing for areas outside of price hotspots that offer the opportunity of lower rents, while still being in commuting distance of the major cities for work and leisure.
Manchester and Liverpool are two of this quarter's top five rental price hotspots, with asking rents increasing by 19.3% and 17.1% respectively compared to this time last year. At the same time, demand has increased in areas surrounding Manchester and Liverpool with lower average asking rents - seven of the top ten rental demand hotspots are nearby the cities.
Preston and Birkenhead, the top two hotspots, have average asking rents of £591 and £551pcm, compared to £876pcm on average for nearby Liverpool.
Rightmove's Director of Property Data, Tim Bannister comments "In the first three months of this year, we've seen tenant demand exceed the high levels set last year, which when coupled with the fewer available homes for rent, has resulted in the most competitive rental market we've ever recorded. There are several factors affecting supply and demand. On the supply side, we're hearing from agents and landlords that tenants are signing longer leases, which has prevented some of the stock that would normally come back onto the market from doing so. When it comes to demand, we're still seeing the effects of the pandemic, whereby tenants are balancing what they need from a home and how close they need to live to work with where they can afford.
"Such a competitive market might be daunting for tenants looking to move home now, however, there are steps they can take to help secure a property. Using our Instant Alerts feature on Rightmove will notify you as soon a property in your area becomes available while having your finances and documents ready will help to show the landlord you are the right tenant for the property. We're also seeing more homes becoming available to rent compared to the beginning of the year, which will provide such much-needed choice for tenants".