According to property data specialist TwentyCi, all regions in the UK sit between 1.5 and three months of rental homes available with the exception of inner London.
It comes as the availability of stock to buy has returned to a pre-pandemic norm.
There has been a five per cent increase in new instructions to the owner-occupied market in 2022 and a 14 per cent drop in sales agreed raising supply across all regions of the UK.
Most areas now have five months or more of supply, which is more than double the levels in some regions during 2021, TwentyCi said.
Inner London and Wales have the most available stock with more than six months, whilst Scotland and the Northeast currently have the least.
In contrast, new instructions within the lettings market are down by almost eight per cent compared to 2021 and by over 25 per cent since 2019.
Rapid property investor withdrawal
Landlords are rapidly withdrawing from the market as tax, regulatory and cost environments have become less favourable, the data firm found.
Lack of supply is further impacted as tenants are deferring decisions to buy because of the cost of living crisis.
This pressure has resulted in average monthly asking price reaching £1,652, an increase of £200 since 2021 and almost £300 since the ‘norm’ of 2019.
TwentyCi also found that the market share of hybrid or online agents fell to 7.3 per cent in 2022, down from the peak of 8.2 per cent in 2019.
And share of market is just 1.1 per cent in properties being sold for £1m or more compared to 5.3 per cent for homes within the £350k-£1m bracket.
Colin Bradshaw, managing director, TwentyCi, said: “2022 was a turbulent year when the widely anticipated housing market re-calibration began to take effect.
“We’ve seen some key shifts; most markedly in the stock situations for both the owner-occupied and lettings markets.
“With the cost of living crisis continuing to deepen, 2023 looks set to be another fast-changing year and it will be important to keep on top of market trends.”
