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Rental Supply Drought - cheaper sector of market is worst affected

The cheapest end of the rental market is under-supplied and overly competitive, a deposit alternative service claims.

The provider - Zero Deposit - says just 1.9 per cent of the UK’s rentals are priced under £500 per month, while tenant demand in this price range is the highest in the market. 

The provider analysed current rental market stock at each rental price band, looking at the proportion of homes available at each price threshold, as well as the demand for these homes based on the number of total homes that have already had a let agreed. 


The 1.9 per cent figure is by far the lowest level of stock of all rental market price bands in the analysis and the firm claims this highlights that those with the smallest budgets face by far the toughest task when it comes to finding a rental property they can afford, let alone securing it. 

For those that are able to boost their rental market budget, the middle of the rental market remains competitive, however, demand is lower for properties with asking rents of between £500 and £2,000 per month, while stock levels are also more robust. 

Some 26.1 per cent of the UK’s stock costs between £500 to £1,000 per month, while 53.0 per cent of rentals are already snapped up, meaning around half of stock remains available. 

It’s a similar situation between £1,000 and £1,500, which accounts for 22.1 per cent of the UK’s stock, while 52.4 per cent of homes are snapped up.

At the rarified range of £1,500 to £2,000 supply is lower, at 16.1 per cent of stock, while demand is slightly higher, at 57.9 per cent. 

Zero Deposit chief executive Sam Reynolds says: “Tenants searching for the most affordable rental properties are facing an insurmountable task, as there’s a real shortage of affordable stock and these properties are being snapped up quickly when they do reach the market. 

“It’s this market segment that is being forced to heavily compromise on their next home while being under considerable financial pressure to fund the move. Of course, it still remains a challenge for those who are willing or able to spend more, but supply and demand are more equally weighted at the mid-range of the market.”

  • icon

    Sam Reynolds is certainly getting his publicity this week.


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