Demand for rental properties up 23% from last year in the UK as rents soar

Demand for rental properties across the UK has leapt by 23% in a year, Rightmove research has found, putting more pressure on a market already in limited supply therefore pushing rents to a record high.

The number of people enquiring has gone up considerably driven partly by first time buyers putting their buyers plans on hold due to mortgage rates escalating.

This has led to an increase in rental prices as landlords realise the demand with the average rent now at a record £571 a week in London.

However, the availability and cost of mortgages has begun to stabilise following a frenzied two months after UK politics caused mayhem in the markets with indications rates could drop next year.

The average two-year fixed rate has come down from a peak of 6.65% a month ago to 6% now. Meanwhile the average five-year fix is now below 6% for the first time.

Mortgage rates are expected to settle at a higher level than buyers are used to in recent years. The Bank of England is expected to raise its base rate to 4.25% by Q2 next year, although that is lower than feared.

There has also been a huge surge in demand for rental units as students and workers have flocked back to the city post Covid. This is paired with a steep drop in supply – London just does not have enough supply to meet the ever-growing population demands.

This is great news for both current landlords and potential Buy to Let buyers.

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