July 2023 Lettings Market Update

We're half way through 2023 so let's have a look at the lettings market reports for Q2. The picture they paint for the rental market is unprecedented but unsurprising.

The UK rental market has experienced significant growth in the last quarter, reaching another record high with average asking rents for new tenants outside of London at £1,231 per calendar month (pcm). Compared to pre-pandemic levels in 2019, rents have surged by a substantial 33%, increasing by over £300 from £923 pcm.

The rapid increase in rents has been driven by increased tenant demand and a limited supply of available rental properties since the pandemic began. Tenant demand remains strong, exceeding last year's levels by 3% and soaring 42% higher than in June 2019. While the gap between supply and demand has narrowed slightly compared to last year, available rental properties are still 42% below 2019 levels.

Tenants are also increasingly choosing to stay in their rented properties for an extended period of time, with 57% of landlords reporting that tenants are staying for more than 24 months, further suppressing supply levels.