The number of available private rental homes has dropped by more than a third since 2019 to a 14-year low.
Only 241,000 PRS homes were available last month compared with 370,000 in June 2019, a fall of 35%, according to consultancy TwentyCi which analysed UK rental data from estate and lettings agents and online property portals.
Chief customer officer Colin Bradshaw says mortgage affordability has dropped dramatically in the last two months, undermining landlords’ business models and causing some investors with rental property portfolios to sell up.
“The yield position on any asset that you own where it’s mortgaged is likely to be severely eroded,” he told the FT.
Average buy-to-let mortgage rates jumped sharply this week, hitting 6.9% for a two-year fixed rate deal, up from 6.6% last week, according to data provider Moneyfacts.
As stock levels have dwindled, rents have risen sharply, reports TwentyCi which says rental prices have gone up by 23% since 2019.
Renters “Availability is reduced and affordability is down,” adds Bradshaw (pictured). “There are fewer properties and they cost more. That’s not great for renters.”
His firm’s data also points towards a big difference in the availability of homes to rent at either end of the price spectrum.
For premium properties renting at £3,000 a month or more – a market dominated by central London – availability has risen by 41% since 2019.
For those wanting to pay less than £800 a month, there are 32% fewer properties than just a year ago and 65% fewer than pre-pandemic.
The combined issues of availability and affordability means that renters will stay in properties for longer; in 2019, the average rental length of a tenancy was 3.6 years but today it is 4.8 years.
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