Tenants Face Higher Competition and Costs Owing to the Renters' Rights Bill

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New research shows that more tenants will compete for fewer rental places as the government intensifies its efforts to deter landlords.

Research of rental data by tlyfe, a tenant-focused app, finds that the rental market imbalance between supply and demand is to deteriorate in 2024 and into 2025.

The research finds the issue is set to become more prominent as a result of the Renters’ Rights Bill, which is set to impose new regulatory burdens on landlords looking to rent their properties.

The rental market saw an average of 2.36 tenants for every private rental property in 2017 when it was at its most stretched.

This eased slightly to 2.28 tenants per property in 2018 and 2019; however, following the outbreak of COVID-19, the figure fell to 2.18 in 2020 and then to 2.15 in 2021.

In 2023 the ratio increased to 2.2 private tenants for every private rental property, and tlyfe forecasts that this ratio is set to climb again this year (2024), with 2.21 private tenants to every rental property in the private rental sector.

This is despite the fact that the number of private tenants is forecast to fall this year, down 1.6% to 10.687m from 10.860m in 2023.

The issue, according to tlyfe, is that private rental stock is also forecast to fall by a greater margin of 2% to 4.838m homes - a reduction of almost 100,100 rental properties available to tenants.

"This reduction in stock has been forecast largely due to Government legislations designed to deter landlords in recent years, with tenants bearing the brunt in the form of higher rents," says tlyfe.

According to the company, the issue only looks set to worsen, with the current Government quick to revive rental reform legislation in the form of the Renters’ Rights Bill, with these further legislative changes expected to deter even more landlords from the sector, leaving tenants with even less choice and facing even higher rents.