A staggering 91% of landlords with property in Outer London reported surging tenant demand during the second quarter, according to new research by Paragon Bank.
The study, conducted by BVA BDRC and involving 983 landlords, found that the supply-and-demand imbalance is propelling an 87% surge in rent levels across local markets.
Among the key findings, 67% of landlords across Britain experienced escalating tenant demand in Q2, maintaining an equal record high from the previous quarter.
Demand in Outer London, East Midlands, and Wales demonstrated exceptional strength, with 91%, 86%, and 82% of landlords respectively indicating a rise in tenant demand. In the North East, 69% of landlords recorded increased demand, while 6% noted a decrease.
Rent hikes are paralleling the heightened demand, with 87% of landlords witnessing rising rental prices in their local markets.
This trend is poised to continue, as 51% of landlords expressed intentions to increase rents within their portfolios over the next six months.
Notably, landlords in Wales (94%), the North East (92%), Yorkshire & Humber (91%), and East Midlands (91%) were the most likely to implement rent hikes in their respective regions.
Louisa Sedgwick, Paragon Bank commercial director of mortgages, highlighted the persistent tenant demand and its impact on the rental landscape, stating: “Tenant demand shows no signs of slowing down in many parts of the country.
“With supply not growing quickly enough to keep pace, we are seeing rental inflation and that is likely to continue until we see demand more in balance with supply.”
The driving factors behind rent increases, as cited by landlords, are general inflation (74%) and the rising costs of property maintenance (59%).
