Landlords Bear the Brunt of the Pandemic as Rent Increases Hit All-Time Low
The number of agents witnessing rent increases hit an all-time low in May, as landlords take the brunt of the significant impact of the pandemic reveals the ARLA Propertymark May Private Rented Sector (PRS) report.
Many landlords have chosen not to increase rents in an effort to recognise the financial difficulties facing many tenants as a result of the Covid-19 lockdown. As a result, the number of tenants experiencing rent increases fell to 14 per cent in May – the lowest since records began. This is compared to more than two in five (41 per cent) agents witnessing landlords increasing rent in February, before lockdown began. This was also a large decrease compared to May 2019, when nearly half (45 per cent) of tenants experienced an increase in rent.
Similarly, more tenants have been successful when asking for a rent reduction, with the number of tenants negotiating rent reductions increasing to 2.5 per cent in May – the highest since March 2019 when the success rate was 2.9 per cent.
As a result of the housing market pause, landlords were unable to show prospective tenants’ new properties and therefore, the average time properties were empty between tenancies increased to five weeks in May. This is the longest time properties have remained void between tenancies since records began as agents and landlords were unable to operate as normal between 23rd March and 13th May.
The number of new prospective tenants fell to 70 per branch in May, compared to 82 in February. However, the level of pent-up demand during lockdown meant that despite the overall fall, this is still the highest level on record for the month of May since records began, with 60 new tenants registered in May 2018, and 69 in May 2019.
David Cox, ARLA Propertymark Chief Executive, said:
“Our latest figures show that landlords and agents have been taking the brunt of the pandemic. They are aware of the financial difficulties facing tenants and have shown empathy with many landlords not increasing rents where they otherwise might have needed to. As we continue to move forward, it’s important that everyone aims to keep the rent flowing in order to sustain the market and help boost the economy following several months of uncertainty.”
Supply of rental stock
Following the housing market reopening, the number of properties managed per branch rose to 208 in May. This is an increase from pre-lockdown when the average number of properties managed per member branch stood at 201. This figure remains the same year-on-year.
Kindly shared by ARLA Propertymark