Rental supply rises year on year despite tax and regulatory pressures

Rental supply across England has increased by more than 15% over the past year, despite ongoing uncertainty for landlords around regulation and taxation, according to new research from Dwelly.

The study examined available rental listings across every county in England, comparing stock levels in December last year with those seen this month. It found that total rental listings have risen from 123,669 to 142,644, representing a 15.3% increase year on year.

The findings come after what Dwelly describes as a turbulent period for landlords, marked by prolonged debate over the Renters’ Rights Act, its eventual approval, and the additional 2% tax increase announced in the recent Autumn Budget.

LIMITED DECLINE

Only three counties recorded a fall in rental availability over the period. Shropshire saw a decline of 3.3%, East Riding of Yorkshire fell by 4.7%, and the City of London recorded the sharpest drop, down 28.5% compared with last year.

In contrast, many areas have experienced a notable expansion in supply. East Sussex recorded the largest increase, with rental availability up 44.8%, followed by Northamptonshire at 42.7% and West Sussex at 37.7%.

The Isle of Wight saw an increase of 36.1%, while Cumbria recorded a 33.6% rise in available rental homes. Dwelly said that a further 21 counties have seen rental supply grow by more than 20% over the past year.

STABILISING MARKET?

The scale of the increase suggests a market that is stabilising rather than shrinking, even as landlords face higher compliance costs and tax pressures.

Sam Humphreys, head of M&A at Dwelly, said: “It’s been an exceptionally turbulent year for landlords, so the assumption might be that rental stock would fall as investors rethink their position. Instead, our analysis shows quite the opposite.

“There has been no knee-jerk withdrawal of homes from the sector and, in fact, renters today have more choice than they did this time last year.

“This increase in available stock is a positive sign for tenants and a reminder that, despite the challenges introduced by the government, many landlords remain committed to the sector.

“At Dwelly, we continue to support letting agents and their landlords with the operational improvements needed to navigate this new landscape, ensuring that rental supply remains strong and responsive to demand.”