Supply fails to satisfy tenant demand

Based on its recent data, the number of rental properties coming onto the market nationally would only satisfy 16 per cent of would-be tenants registering their interest in moving home.

It seems that despite high demand for rental property in the last quarter of 2010, as shown by the fact that Sequence registered well over 22,000 new applicants in this period, the number of properties coming onto the lettings market decreased.

Although there is traditionally a drop off in supply in the run up to Christmas, which was not helped this year by the bad weather, its clear that many more rental properties are needed to meet demand.

Stephen Nation, Divisional Managing Director for Sequence Lettings, says:

"The shortage in supply of rental property has pushed up rents for landlords and there is currently a huge demand for rental property which is not being met.

"Our latest figures show a discrepancy between those looking for tenancies and the properties available to them which means landlords are missing out on a large amount of potential rent income."

In January, Sequence saw a 25 per cent increase in the number of homes to rent, although even this will only satisfy 12 per cent of the new applicants who have registered an interest with Sequence's lettings branches.

Regionally it's a similar story although figures are slightly higher in the North of England, where rental property currently caters for around 14 per cent of would-be tenants, and lower in the South and South West of the UK, where the number of new homes to rent is only 10 per cent of the number of new applicants.

Stephen continues:

"With rents and yields rising, it is surprising that landlords and investors are not doing more to grow their portfolios.

"As the residential sales market improves and mortgage finance for first-time buyers becomes more widely available we may see a drop off in demand, but at the current time, we need more properties to let and landlords are missing a trick if they do not take advantage now."