Demand for rented properties bounced back 30% in the two weeks to 14 April, after falling 57% in the wake of the coronavirus pandemic, according to Zoopla’s latest quarterly Rental Market Report.

The property expert suggested the impact of coronavirus had been less pronounced in the lettings market compared to the sales market.
 
Demand for rental properties fell by more than 55% between 7 March and 30 March, while the sales market was hit by a 70% decline in buyer demand, after the Government effectively suspended transactions, Zoopla suggested, adding that the increased uncertainty means households looking for a home will turn to the rental market first to meet any immediate housing need.
 
Zoopla’s report also noted the additional flexibility in the lettings market, which has allowed agents to agree rental contracts with delayed start dates, as well as agree terms based on online viewings, means that activity has continued throughout the lockdown, albeit at a significantly lower rate.

“The flexibility of the rental market is one of the key factors which has allowed activity to bounce back more quickly than other parts of the property market,” Zoopla head of research, Gráinne Gilmore, commented. “The rise in demand in the first two weeks in April indicates that some tenants are already mapping out their next move.
 
“As with the whole housing market however, activity levels and rental growth will likely be closely aligned to the economic landscape of the UK once the lockdown eases and the immediate impact of Covid-19 starts to recede.”
 
The report also suggested that once the lockdown restrictions ease, activity levels will “likely rise” and match previous years’ levels in the typically busier seasonal periods in the year’s third and fourth quarters – meaning the total number of moves within the rental sector will be approximately 25% lower than in 2019.
 
Furthermore, Zoopla highlighted the total number of properties listed as available to rent had remained “broadly unchanged” since the start of lockdown, down 3% since 1 March.
 
Gilmore continued: “Rental growth has increased steadily for the last three years as demand has increased in the face of dwindling new supply.

“However, if the responses to Covid-19 contribute to a rise in unemployment, as some official bodies have forecast, this will reduce the scope for any additional growth in rents. We expect growth to moderate this year, but to remain in positive territory.”

Share Story: