Paragon Bank has reported that the strong tenant demand seen during last year has continued into 2022 after growing to the highest level recorded since 2011, when research agency BVA BDRC started tracking the metric.
The buy-to-let specialist said figures for the first quarter of the year suggest that numbers of people seeking privately rented homes have grown consistently throughout the course of the Covid pandemic. The 62% of landlords who reported increasing tenant demand in Q1 2022 is double that of the same period a year ago and almost four times the level reported in Q1 2020 when only 16% of landlords felt that demand was growing.
As part of the most recent research, over 700 landlords were asked to assess tenant demand over the previous three months. A ‘significant increase’ was seen by over a third, 34%, of respondents, with a further 28% reporting slight increases. Perceived decreases in tenant demand, both significant and slight, were recorded by just 3% of landlords, the lowest on record.
Analysing the results regionally highlights the impressive resurgence of the Central London rental market. Increasing tenant demand was reported by 84% of landlords operating in the inner capital, a substantial increase on the 12% seen in Q1 2021. This places Central London alongside the South West and Wales as the regions seeing the highest levels of increasing tenant demand during the previous three months.
Moray Hulme, mortgage sales director for Paragon Bank, said: “Another record high in the proportion of landlords reporting increasing tenant demand reaffirms the need to increase the supply of homes in the private rented sector.
“There is evidence of landlords exiting the sector with many citing increasing tax and regulatory requirements making their lettings business more arduous to operate. While it is clearly important that landlords are taxed appropriately and the sector is regulated to ensure high standards are maintained, we must ensure that buy-to-let remains attractive enough to investors who are vital in supplying the properties needed to meet demand.”
