Demand from tenants hit record high

More than a third of those landlords said that the increase in demand was “significant” too, with landlords in the South West (79 per cent) and South East excluding London (74%) seeing the most dramatic demand jumps. 

This drops to 54 per cent among portfolio landlords in the capital, with the city also seeing the highest numbers of landlords reporting decreasing demand (16 per cent). However, Paragon argued that prospects remain good for London, given that in the same period of 2020 just 16 per cent of central London landlords reported rising demand from tenants.

Richard Rowntree (pictured), managing director of Paragon Bank, noted that the third quarter of the year is often busy for the private rented sector (PRS) with the beginning of the academic year, graduates starting new jobs, and people turning to the housing market once the holiday season has finished.

He added: “With this seasonal demand added to already high levels of tenant demand, we are beginning to see a shortage of property in certain parts of the PRS, which is leading to rental inflation. The sector needs to expand to meet these exceptional levels of tenant needs.”