The great stay on site! Tenants choose to renew their lease rather than move

A lack of rental property supply is encouraging tenants to stay put and renew their leases rather than move out, new research shows.

A total of 73% of letting agents said they had seen an increase in the number of tenants choosing to renew their contract over the past 12 months.

The findings came from rental agency Propertymark, which claimed tenants were choosing to stay put rather than move out, in a trend described as ‘The Big Stay Put’.

Propertymark said an average of 127 new applicants were registered per letting agent branch last month.

At the same time, rental agents said they had an average of 11 properties available for rent per agency in July, the same figure as the previous month.

Meanwhile, 82% of letting agents said monthly rent prices rose in July – a new record high.

Nathan Emerson of Propertymark said: ‘The private rental market continues to be battered by the perfect storm of high demand, low availability and affordability issues that show no signs of abating.

“Governments across the UK are all committed to tenant-focused reform of their private rental sector.

“To boost supply, they must also consider the heavy tax burden on landlords, the impact of more profitable and less regulated short-term rentals, many of which sit empty for part of the year, and lack of new houses being built. to meet the varied needs of a growing population.

Separate research earlier this year by Propertymark found that the number of properties available to rent through letting agents in March had halved between 2019 and 2022.

During this period, 84% of owners who took their property off the rental market did so to sell. More than half of rental properties sold in March 2022 did not return to the rental market.

An average of 127 new applicants were registered per rental agency last month

Earlier this month, a study found that four in 10 people under 30 were spending more than 30% of their salary on rent, a five-year high that experts say is unaffordable.

This age group spends more of their income on rent than any other working-age group, according to data provided to the BBC by property market consultancy Dataloft.

The under-30 rent crisis comes amid a cost of living crisis that has seen inflation hit a 40-year high, with energy and food bills rising rapidly.

The data revealed that while London has the highest rents in the UK, places like Rotherham, Bolton, Salford, Walsall and Dudley have seen affordability fall the most since the Covid pandemic.

People are driven to offer more than “asking” rent, and in some cases more than they can reasonably afford, in bidding wars for rental properties due to a lack of homes on the market.

Jonathan Rolande, property expert at House Buy Fast, said the ‘unprecedented crisis in the rental sector’ was due to a ‘chronic lack of supply which urgently needs to be addressed by ministers with imaginative and ambitious ideas’.