The level of rental properties remains drastically low, according to the latest Housing Insight report from letting agents trade body Propertymark.
The average number of properties available to rent per member branch in September 2023 remained broadly the same as in August 2023 at 11 properties. It should be noted that there has been little fluctuation in supply levels over the last 12 months.
However, this level of supply remains drastically below the current level of new applicants registered.
Although there has been a downward trend over the last few months, demand in the form of new tenant registrations continues to outpace supply.
The average number of new tenancies agreed per member branch is little changed across July, August and September 2023, due to ongoing challenges in supply.
The supply and demand imbalance continues to affect rents, with 52 per cent of Propertymark’s surveyed members reporting that rents had risen in their branch during September 2023.
However, fewer agents reported rents had risen in September 2023 than in either July or August (71 per cent and 68 per cent respectively). The data points to short term restraint in rental growth.
A previous report from Propertymark found a significant factor in the lack of growth in available properties in the UK are the “financial implications and barriers” in purchasing a buy-to-let property.
The report pointed to higher rates of property tax on buy-to-let properties, withdrawal of tax relief on mortgage interest, removal of 10 per cent wear and tear allowance, maintaining Capital Gains Tax for rented property at 18 per cent for rented properties and 28 per cent for higher rate taxpayers and an increase in corporation tax.
Tax relief on mortgage interest has been replaced with a 20 per cent tax credit and at-cost relief is in-place for wear and tear allowance.
Nathan Emerson, CEO at Propertymark, says: “Governments across the UK continue to tinker with legislation and legislative programmes, disincentivising landlords along the way. Supply remains tight with far more applicant registrations than properties available. Pressure on rents continues although there are some signs of restraint in this month’s figures compared to last month.”