The supply of rental properties fell by 3.7% during October when compared to the previous month, according to fresh data from the Association of Residential Letting Agents (ARLA Propertymark).
ARLA Propertymark’s latest Private Rental Sector Report reveals that the average letting agency branch managed 182 properties in October, down from 189 in September.
The number of properties managed by the average agent last month was the lowest figure recorded so far this year. In fact, the figure has not been so low since October 2016, when agents managed 180 on average.
Demand for rental homes also dropped last month to just 69 prospective tenants registered per branch, down from 79 a month earlier.
The number of tenants experiencing rent increases fell to the lowest level since December 2016. Just over a fifth - 22% - of agents witnessed landlords hiking rent costs, down from 27% in September, and a high of 35% in August.
But David Cox, ARLA Propertymark’s chief executive, warns that rents are likely to rise once the market picks up after the festive period, unless there is a sudden surge in the supply of rental homes coming on to the market.
He said: “While this time of year is one of the busiest for people buying and selling properties, it’s typically slower for the rental market. A large number of tenancies are agreed over the summer, meaning both supply and demand are usually lower in the Autumn. However, a lot are also agreed in the New Year and if stock remains low, competition for properties among prospective tenants will increase, which will in turn push rents up, so we must see an increase in supply over the next two months.
“With that in mind, it’s good news that the recent spate of rent increases we’ve seen seems to have slowed, but 22% is still high. The cost of living continues to rise and for many, the dream of homeownership is too far out of reach.
“Last week’s news that stamp duty will be cut for first-time-buyers will mean consumers feel more positive and will hopefully go some way towards helping more people get onto the housing ladder. But if rent costs continue to rise, it will forever be an unreachable aspiration for many.”