Rental market shrinks despite government claims private rented sector is expanding

Despite the government’s claim that the private rented sector has doubled in size, research reveals a decline in supply.

Analysis by Savills for The Telegraph shows a drop in the number of homes to rent in London, which has fallen by 21.7% compared with two years ago.

The data also reveals that, at the same time, the number of homes advertised for sale in London surged by 17.6%

PRS has doubled in size

According to The Telegraph, the number of homes advertised to let fell by 20.6% while stock on the sales market jumped by 14.8%.

The change is even more pronounced in the flat sector, which has a higher concentration of buy-to-let properties, with sale listings climbing by 30.9%.

Across the country, the same pattern is evident, with the supply of homes to rent falling by 17% over the past two years, while the number of homes for sale has grown by 10%.

However, with the Renters’ Rights Act already in force, the government claims that the private rented sector is expanding and argues that the act will support tenants.

A spokesperson for the Ministry of Housing, Communities and Local Government told The Telegraph: “The private rented sector has doubled in size since the early 2000s and our landmark Renters’ Rights Act will give millions of tenants the security and stronger rights they need and deserve, including stronger powers to challenge above-market rent increases.

“We are also increasing capacity in our legal system by recruiting up to 1,000 judges and tribunal members across all courts and tribunals this year.”

More landlords will exit

The government added that capacity in the legal system is being increased, with up to 1,000 judges and tribunal members being recruited across courts and tribunals this year.

However, despite the Renters’ Rights Act already being in force, Savills expects it to push more landlords to exit the market over time.

Lucian Cook, the head of residential research at Savills, told The Telegraph: “Clearly, we will see a few more landlords leave the sector in the coming months, but we should be at or around the peak.”