Average rents across the nation have continued to rise, albeit at a slower pace.
According to the latest data released by Rightmove, asking rents for new tenants outside London have hit a new record high of £1,190 per calendar month.
It is the 13th consecutive quarter rents have risen although the pace of growth is slowing and has eased for the last three quarters.
Supply remains very constrained in the rental market, however, there are signs of improvement this year.
The number of available properties is currently 6% higher than this time last year, while across the first three months of this year, the number of available rental properties is up by 8%.
However, supply remains very low, with the number of available rental properties now 46% below 2019’s level.
The data from Rightmove comes alongside a survey from Paragon Bank which found tenant demand in Q1 has surged to an all time high. The survey of nearly 700 landlords found 67% had experienced increase tenant demand, up from 65% during the final quarter of 2022.
In response to the rising demand, the survey found rents had also increased with 85% of landlords saying rents were rising and 52% saying they were planning to increase rents in the next six months.
Rightmove did find some good news in that the gap between supply and demand has improved slightly compared to last year however a significant imbalance remains with the number of tenants looking for a home to rent greatly outweighing the number of homes available.
Competition between tenants has eased by 2% compared to last year, but it is still more than double (+173%) the level it was in 2019. Tenant demand is 4% higher than this time last year and 48% higher than in 2019.
The Rightmove research shows terraced houses have the biggest gap between supply and demand with more than four times as many tenants enquiring as there are properties of this type available.
Sheldon Bosley Knight’s associate director, Nik Kyriacou said: “It is back to the same old problem of supply and demand. If we don’t have enough properties for the amount of prospective tenants, rents will no doubt increase.
“The government does really need to get a grip on this and find ways to create homes to rent. This could be conversion of former city offices to residential, or building new homes for rent as well as providing incentives for current landlords to stay within the sector.
“Without these measures, tenants will continue to face competition for properties and increasing rents and that is no good for the healthy rental sector we all want to see.”