A long-term shortage of stock means the rental sector is “massively underperforming” according to the property analytics service TwentyCi.

It says in its latest quarterly market snapshot that when comparing the lettings sector in Q1 2022 with Q1 2019 – the last ‘normal’ year pre-pandemic – the issues are clear.

New instructions are down by over 28 per cent compared to Q1 2019 outlining a lack of rental stock available.  The volume of lets agreed is also down by 17 per cent compared to Q1 2019. 

TwentyCi spokesman Colin Bradshaw says: “With a lack of stock in the residential owner-occupied sector one might expect a buoyant rental sector. However, to the contrary, we are seeing an extremely lacklustre level of activity. 

“With fewer rental properties coming to the market, one would expect an excess in demand to result in a higher level of lets occurring, but perversely this is not the case. 

“One might surmise that renters are staying put, with few alternative options available, the step to the owner-occupied sector extending and the pressure on household incomes encouraging people to stay put. 

“We are also undoubtedly seeing some effect from the shrinkage in the number of landlords due to the tax changes put in place in 2019.”

The analysis goes on to say that the average asking price across the UK is now £1,495 per month, an increase of 10 per cent from Q1 2019. 

“This may be considered surprising in a lacklustre sector, however, with interest rates rising and energy costs rocketing we would expect to see landlords passing on these increases through rent rises” says the market report, out today.