New figures from flat-sharing site SpareRoom suggest that while rents are still climbing, there are early signs of a lettings market recovery.
The ratio of people searching last month for a room compared to rooms available fell year-on-year, compared to July 2022, signalling a slight stabilisation in the supply and demand imbalance that has characterised the last two years.
Last month, the number of active renters searching to number of rooms available in the UK was 5.6, compared to 6.2 in July 2022. In London it was 4.9, compared to 6 at the same point last year.
The number of active renters in London fell by 0.2 per cent YOY in July 2023, whilst the number of live room ads increased by 20.8 per cent.
Looking at the UK more broadly, the number of active renters seeking a room rose by 7.5 per cent whilst room ads were up by 19.5 per cent.
Demand is still outstripping supply month-on-month but the data indicates that year-on-year, the imbalance has steadied.
Matt Hutchinson, SpareRoom director comments: “Although demand from renters is rising, there are substantially more rooms available than there were a year ago, meaning competition for those rooms is less fierce. Our hope is that, as we head into the peak of the market in September, it means we’ll see a better balance than we did in 2022.
“We know from surveying renters that many people are choosing to stay put to avoid rent increases. This could partly explain the slight stabilisation, or maybe people are simply giving up on London entirely thanks to rocketing rents, which would explain the London figures.
“There’s still a very long way to go before the rental market is fully recovered, but compared to where we were this time last year, things seem to be improving.”