Propertymark chief executive Nathan Emerson says the lettings market is defined now by the “alarming disparity” between demand and supply.

In the trade body’s latest market snapshot, based on responses from 99 lettings agencies, Emerson says: “We continue to see an alarming disparity in the number of homes available to rent when compared with growing demand from prospective tenants. 

“The number of prospective new tenants is up by 38 per cent in July compared to the same time last year, yet the number of properties available per member branch has risen by only 24 per cent meaning this gap is continuing to widen from already worrying levels. 

“This mismatch in supply and demand is putting pressure on rents with six per cent of tenants per member branch falling into arrears – doubling compared to February 2023. Governments across the UK need to urgently address the fundamental problem of undersupply and look to adequately incentivise the provision of desperately needed homes in the private rented sector.”

The Propertymark snapshot shows that the number of new prospective tenants registered per member branch took a sizeable jump in July; this showed an average of 187 prospective tenants registering on average compared to 127 in July 2022. 

Figures in July 2023 were up almost 38 per cent year on year, a continued trend that is predicted to show no signs of slowing. 

Meanwhile the number of properties available to rent per member branch increased slightly in July to an average of 14. This is still below what is needed to keep up with current demand, the trade body insists.

With demand up and stock levels down, Propertymark says it is no surprise that the mismatch between supply and demand continued in July with an average of 13 new prospective tenants registering per available property over the month. 

On the sales side – and after 14 successive base rate rises from the Bank of England – the average number of new prospective buyers registered per Propertymark member branch is down to an average of 64 in July 2023, down from 86 in June 2023. 

In July, the average number of viewings per available property was 1.5 in July compared to 3.0 in June 2023. 

The supply of new homes placed for sale per member branch showed a positive lift in July – now at 10 per member branch. The average number of sales agreed per member branch also showed an uplift to eight in July. 

Emerson concludes: “As the number of viewings and valuations drop, this indicates a shift to only the more serious homebuyers and sellers are remaining proactive in the market. Those properties that are currently for sale with motivated vendors in line with the market are selling quickly.”