The private rented sector is running out of capacity, according to ARLA (the Association of Residential Letting Agents).
The trade body says the number of letting agents reporting more tenants than properties has hit a record level, with 74% saying that demand is outstripping supply.
The increase in demand is particularly acute in London and the south-east.
The latest ARLA survey, of 572 lettings offices operated by members, also demonstrates that the period in which tenants are staying in their properties has increased to 19 months, as tenants give up trying to find a new property in such a competitive market.
The number of new tenancies signed up by agents has risen rapidly in a consistently upward trend since 2001. But this figure has remained consistent at 34 new tenants every month per branch throughout 2011 after record numbers of new renters entered the market in 2010.
Tim Hyatt, president of ARLA, said: “The UK cannot rely on the rental sector to support the housing market in perpetuity.
“The reality is that there is a finite amount of rental property, and unless both housing supply and mortgage availability improves, then renters will find that their options in the market are reduced.
“The Government is doing little to encourage landlords to invest in new properties therefore we are running out of quality stock to offer to tenants.
“This is reflected in rent increases and a lack of choice for consumers.”
The full survey, which covers the third quarter of this year, is at https://www.arla.co.uk/buy-to-let/buy-to-let-review/2011/q3/
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