Tenant demand hits new all-time high

The proportion of landlords who are reporting increasing tenant demand has hit an all-time high – for the second time this year.

The findings from Paragon Bank found that a net increase in tenant demand during the past three months was seen by 65% of respondents.

This surpasses the previous all-time high of 62% recorded during the first quarter of this year, marking a consistent and significant rise in tenant demand since the low net increase of 14% was recorded in Q2 2020.

Breaking down the net increase also shows that the 39% of landlords who reported that demand had ‘increased significantly’ was the highest proportion since the metric was first tracked in 2011.

Just 1% of landlords felt that tenant demand had ‘decreased slightly’

More than 700 landlords were surveyed, and researchers also found that just 1% of landlords felt that tenant demand had ‘decreased slightly’, while none said it had ‘decreased significantly’ – a first for the bank’s survey.

Moray Hulme, the mortgage sales director for Paragon Bank, said: “We’ve seen demand for privately rented homes climb consistently since the pandemic.

“The fact that the all-time high we reported earlier this year has now been surpassed supports our view that the private rented sector remains an essential component of UK housing provision.

“Renting appeals to people of different demographics and from all walks of life but the flexibility and relative affordability of rented accommodation means its value is even more apparent at what is an economically challenging time for many.”

‘Strong tenant demand reported in all areas’

Ms Hulme added: “Viewing the findings at a regional level, we see strong tenant demand reported in all areas throughout England and Wales.

“Interestingly, a trend emerges in the South West, Wales and outer London, with landlords in each of these regions noting strong tenant demand during each quarter so far in 2022.

“Net increases in tenant demand were recorded by 88% of landlords in the South West and by 84% of landlords in both outer London and Wales in Q3 2022.”