Rental stock across England fell by more than 15,500 properties during the third quarter following the introduction of the Renters’ Rights Act, new analysis reveals.
The number of homes available to rent dropped from 127,696 in Q2 to 112,190 in Q3, according to The Letting Partnership.
That represents a quarterly decline of 12.1%, although some areas recorded considerably larger reductions.
The figures cover the first full quarter since the Renters’ Rights Act came into force on 1 May, introducing substantial changes for landlords and letting agents across the private rented sector.
STOCK FALLS
The City of London records the largest quarterly decline in available rental properties at 42.4%, followed by Bristol at 36%.
Rental availability falls by 30.5% in Merseyside and 20.5% across Greater Manchester.
Oxfordshire and the West Midlands both record reductions of 19%, while Greater London sees available stock fall by 18%.
South Yorkshire is down 17.9%, followed by West Yorkshire at 16.9%, Nottinghamshire at 15.7% and both Leicestershire and Tyne and Wear at 14.7%.
Chris Mason (main picture), Chief Executive Officer of The Letting Partnership, says: “The Renters’ Rights Act represented an enormous change for the private rented sector and, just months after its introduction, we’ve seen a pretty dramatic reduction in the number of homes available to rent.
“More than 15,500 rental properties have disappeared from the market in a single quarter, equating to a 12% reduction in available stock, although this reduction has been far more pronounced in some areas.”
LANDLORD CONCERNS
Mason argues the reduction will add to concerns that greater regulation could encourage some landlords to leave the sector.
He says: “One of the concerns throughout the build-up to rental reform was that the additional regulatory and compliance burden could deter landlords from remaining within the sector.
“Such a notable reduction in rental stock availability so soon after the Act came into force is certainly going to add fuel to those concerns.”
However, a quarterly reduction in properties advertised for rent does not by itself demonstrate that landlords have sold or permanently withdrawn those homes from the private rented sector.
AGENT ROLE
The Letting Partnership expects the increased regulatory burden to strengthen demand for professional property management as landlords seek help navigating the new regime.
Mason says: “For landlords who remain, the sheer scale and complexity of their responsibilities has increased substantially and we expect this to further strengthen the role of professional letting agents, particularly amongst those landlords who no longer feel comfortable navigating the regulatory landscape alone.
“However, that also means more responsibility for the lettings industry. As agents take on more fully managed properties, they are also taking responsibility for more tenancies, processing more rent and client money and shouldering a greater administrative and compliance burden.
“As the sector adjusts to life under the Renters’ Rights Act, it’s vital that the systems, processes and client accounting infrastructure sitting behind the industry are capable of keeping pace.”
