Home Property Insurance Renting: the tough legislation of provide and demand

Renting: the tough legislation of provide and demand

Renting: the tough legislation of provide and demand


Within the non-public rented sector, the tough legal guidelines of provide and demand are pitting tenants towards landlords, defined the cash pages of the Every day Mail on the 30th of August.

The antagonism between landlord and tenant is coming to a head by way of the quite simple results of the legislation of provide and demand – the availability of rental lodging is drying up, the demand for rental lodging continues to soar, and the inevitable consequence is a rise in rents that many tenants merely can’t afford.

Let’s take a more in-depth have a look at the elements on this easy but merciless equation.


In contrast with occasions solely not too long ago passed by, at the moment’s landlord is below appreciable monetary stress to show a revenue from any by to let enterprise.

After a painful few years whereas it was being phased out, the tax reduction beforehand loved by landlords on their month-to-month mortgage curiosity funds lastly got here to an finish in April 2020.

As an alternative, landlords now qualify for tax credit primarily based on 20% of their mortgage curiosity funds. These are far much less beneficiant than the earlier system of tax reduction and – as defined in a report by Which? journal in April 2022 – will truly drawback some landlords.

There are actually 168 separate items of laws regulating the non-public rented sector and the chief government of the Nationwide Residential Landlords Affiliation (NRLA) has mentioned that the sector is “overrun by guidelines and rules”.

Many landlords appear to agree and, in response to a report by Landlord Zone on the 15th of July 2022, such a “struggle on landlords” will successfully scale back the variety of properties obtainable to hire by some 46,000 this 12 months alone – the equal of three,800 let properties each month.


Whereas many landlords are promoting up and lowering the reservoir of accessible properties to let, there isn’t a let-up within the variety of tenants desirous to hire.

The variety of landlords withdrawing from the purchase to let market is staggering. In line with a narrative within the media outlet Bloomberg on the 24th of August 2022, the variety of properties obtainable for hire fell by 49% from March 2019 to March 2022 – the pool of accessible rental lodging was halved in simply 3 years.

For that cause, argued the Guardian newspaper on the 14th of February 2022, the UK would require a complete of 227,000 new rental properties every year with a purpose to meet the demand from an anticipated 1.8 million new households created throughout the forthcoming decade.

The result’s that even now queues kind exterior flats which are marketed for hire in London. A narrative in My London on the 28th of August 2022 recounted that hopeful tenants had lined up 15-deep to view a single flat.

Determined occasions name for determined measures as potential tenants additionally entered into bidding wars with landlords concerning the hire they’re ready to pay, with some providing to place down a complete 12 months’s hire merely to safe a tenancy.


Within the meantime, the inevitable consequence of the imbalance between provide and demand is a rise within the rents that landlords cost – for these landlords ready to proceed their purchase to let enterprise, in fact, working prices and the final results of inflation additionally have an effect on them.

On the face of it, common hire will increase throughout the nation appear to be moderately modest. Figures launched by the Workplace for Nationwide Statistics (ONS) on the 17th of August 2022 revealed that the nationwide common enhance in rents within the 12 months to the top of July was 3.2% – up barely from the three% recorded within the 12 months to the top of June.

As ever, statistical averages will be misleading – particularly in case you are unlucky sufficient to be searching for rented lodging in sure hotspots.

In its version of the 17th of August 2022, the housing journal Huge Difficulty famous that the median month-to-month price of hire in England and Wales had reached £795 – its highest ever and a charge of development that’s climbing quicker than at any time within the final 16 years.

The Huge Difficulty notes that situations are most likely the worst in London, the place the median hire has now reached £1,450 a month – some £500 steeper than some other a part of the UK. Within the capital, rents have soared by a mean of 19% since their pre-pandemic ranges.

Outdoors London, the nationwide common hire presently sought by landlords is £1,126 a month – 3.5% increased than the degrees recorded within the earlier quarter of the 12 months and almost 12% increased than in June of 2020.


When the steadiness between provide and demand is so severely out of kilter, the results on rents will be substantial. The antagonism this generates between landlord and tenant is just possible to enhance when the provision of rental lodging within the non-public sector begins to match the demand.



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