A growing number of people are struggling to find homes to rent, as the supply-demand imbalance in the PRS continues to widen, new figures show.
According to the newly released End of Year 2022 Property & Homemovers Report from property and data insight specialist, TwentyCi there are now more homes available to buy, but there are significantly fewer properties to let.
The data reveals that the availability of stock within the owner-occupied market is now back to a pre-pandemic norm, but the reverse is true for the letting market.
The figures reveal a 5% increase in new instructions to the owner-occupied market in 2022 and a 14% drop in sales agreed which together have resulted in a significant easing of stock available across all regions of the UK. Most areas now have five months or more of supply, which is more than double the levels in some regions during 2021. This is far closer to the number of houses available for sale back in 2019 prior to the onslaught of Covid-19.
Inner London and Wales have the most available stock with over six months, whilst Scotland and the Northeast currently have the least at around four and a half months of stock each. Despite this easing of the supply squeeze, house prices have remained buoyant, 8.4 per cent higher than in 2019, but down from the peak recorded in Q2 2022.
In contrast, new instructions within the letting market are down by almost 8% compared to 2021 and by over 25 per cent since 2019.
Buy-to-let landlords are rapidly withdrawing from the market as tax, regulatory and cost environments have become less favourable. Apart from Inner London, which currently has four and a half months of letting property stock on the books, all regions sit between 1.5 and three months of rental homes available.
Renters in Scotland and Northern Ireland are in the most precarious situation. Lack of supply is further compounded on the demand side as tenants are deferring decisions to buy because of the cost-of-living crisis. This pressure has resulted in average monthly asking price reaching £1652, an increase of £200 since 2021 and almost £300 since the ‘norm’ of 2019.
TwentyCi’s MD, Colin Bradshaw, commented: “2022 was a turbulent year when the widely anticipated housing market re-calibration began to take effect. We’ve seen some key shifts; most markedly in the stock situations for both the owner-occupied and lettings markets. With the cost-of-living crisis continuing to deepen, 2023 looks set to be another fast-changing year and it will be important to keep on top of market trends.”
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