Recent data highlights a severe shortage of private rental homes to meet the high demand.

According to research, undertaken by Pegasus Insight on behalf of a trade association, 79% of landlords noted strong demand for private rented housing in the third quarter of the year.

The research further shows that landlords in the South East experienced the highest demand, with 84% reporting strong demand in Q3 2024.

However, the data shows that demand for private rented accommodation is lowest in the West Midlands.

In spite of this trend 19% of landlords across England and Wales reported selling property in the past 12 months—more than twice the 8% who purchased properties in Q3 2024.

Looking ahead, 41% of landlords plan to sell at least some rental properties over the next year, compared to just 6% who intend to buy.

The trade association cautions that most tenants will face extreme hardship if landlords continue to sell properties. Currently, only one in eight tenants can afford to buy a home in their current area, according to data from Oxford Economics.

Budget decisions are expected to exacerbate the supply shortage in the rental market and increase stamp duty for many first-time buyers. Additionally, the Office for Budget Responsibility predicts that mortgage rates will stay elevated for longer than anticipated.

The housing shortage in the rental market will most significantly impact those receiving housing benefits, as they face the likelihood of their housing cost support being frozen from next year.

A spokesperson for the trade association, says: “Tenants the length and breadth of the country know that there are not enough homes to rent. Rather than seeking to tackle it, the Government is instead doubling down on policies that have caused the chasm between supply and demand to widen in the first place.

“Whilst landlords selling up might benefit a minority of tenants in a position to afford a home of their own, the vast majority will face a growing struggle to access rental homes.