Tenant demand for rented homes is on the rise

Despite ongoing affordability issues, tenant demand for rented properties in England has climbed slightly in the second quarter of 2024 compared to the first quarter, research reveals.

According to Zero Deposit’s rental demand index, demand reached 33.3% in Q2, meaning a third of all rental properties found a tenant.

While this is 1.5% higher than Q1 2024, it remains 2.3% lower than the same period last year.

Herefordshire topped the list for the biggest quarterly increase in tenant demand, with a jump of 11.9%.

Tenant demand has continued to climb

The firm’s chief executive, Sam Reynolds, said: “So far this year, tenant demand has continued to climb, and we’ve seen an uplift in the number of available homes being let during Q2 when compared to the first three months of the year.

“Demand is particularly strong across a number of south coast hotspots and as we enter further into the summer months, this is likely to remain the case.”

He added: “However, demand for rental properties across the nation is still yet to return to the same levels seen last year and it’s clear that the ongoing issue of affordability is continuing to restrict the market, particularly in the current economic landscape.

“There are growing examples of later stage dropouts and properties staying on the market for longer as renters have a greater choice of property and see less of a need to heavily compromise on their next home.”

West Sussex emerged as the hottest rental market

The index also reveals that West Sussex emerged as the hottest rental market overall, with over half (57.2%) of available properties being let.

The City of London recorded the second biggest quarterly rise of 8.4%, with Northumberland (7.3%), the West Midlands (7.2%) and Cumbria (+6%) also making the top five list.

There’s also high demand in Somerset at 53.7% in Q2, followed by Suffolk (53.4%), Dorset (53%) and Cornwall (49.9%).

However, Nottingham had the lowest demand, with only 18.5% of rentals finding tenants.