Lockdown rental stock shortage will see rents and deposits climb

May 4, 2020

Research by rental deposit replacement scheme, Ome, has highlighted how a lockdown reduction in rental stock entering the market could result in higher rental and deposit costs for UK tenants.

Ome investigated the percentage of buy to let mortgage loans approved over the last five years as a percentage of all loans. The figures from the Financial Conduct Authority show that the number of landlords entering the market with new stock has slowly declined every year since 2015 with an average annual drop of -1%.

At the same time, the value of the buy to let market has also diminished at an average annual rate of -1% a year, now worth £35,661m compared to £37,424m in 2015.

Despite a declining level of stock entering the market, there has been growing demand which has seen the average UK rent climb by an annual average of 4% each year since 2015, now at £743 a month compared to £627 in 2015. The average cost of a rental deposit has also increased at an average rate of 3% each year over the last five years.

A similar increase this year would see the average rent hit £776, while the average deposit would reach almost £900 despite the recently introduced five week deposit cap. However, Ome predicts that any lasting reduction in rental stock due to the current pandemic could result in a much larger increase in cost for UK tenants in the long term.

United Kingdom
2015
2016
2017
2018
2019
Average Annual change
Buy to let (% of gross advances)
16.81
16.04
13.43
13.02
12.96
change
-0.76%
-2.62%
-0.40%
-0.07%
-1%
Buy to Let VALUE – £millions
37,424
40,129
35,182
35,731
35,661
change
7.2%
-12.3%
1.6%
-0.2%
-1%
Average rent
£627
£643
£656
£677
£743
change
2.6%
1.9%
3.2%
9.8%
4%
Average Deposit
£758
£766
£777
£790
£858
Change
1.1%
1.4%
1.7%
8.6%
3%
Sources
Lending statistics – Buy to Let
Average private rent statistics
England
Wales
Scotland
Northern Ireland

Properganda PR

National and local media coverage for property businesses. Journo quotes delivered in minutes.

You May Also Enjoy

Breaking News

Autumn Budget 2026: Property industry reaction

Following today’s Autumn Budget, reaction from property industry experts on six key areas for the property market. First-time buyer support: The £4.7bn Your First Home equity loan scheme, supporting 70,000 buyers, alongside the introduction of a new First Time Buyer ISA. Inflation and borrowing costs: The extension of the fuel duty freeze, household energy support…
Read More →
Breaking News

Can you legally BAN Halloween Trick or Treaters?

People who dread the annual knock of trick-or-treaters may have more power to keep Halloween callers away than they realise. As millions of children prepare to take to the streets on October 31, a property law expert has explained what homeowners can do if they do not want strangers walking up their path or knocking…
Read More →
Estate Agent Talk

What the sector need to do differently to give first time buyers a chance

By Peter Hawley, Director, SOWN (part of LRG) The mortgage and property sector needs to stop assuming that younger buyers are either ready to buy outright or not ready at all. For many, the reality is somewhere in between. They may have stable employment, a deposit and a strong desire to own, but still find…
Read More →
Letting Agent Talk

The 50-property tipping point: when landlords need a different approach

By Adam Hills, Client Services Director, LRG Living Markets A sizeable residential property portfolio can create significant opportunities for long-term income and capital growth. But as it expands, so does the complexity of managing it effectively. For landlords with 50 or more properties, the challenge extends well beyond finding tenants or collecting rent to communication,…
Read More →
Estate Agent Talk

Home is where the stress is

Couples find first-time buying more anxiety-inducing than buying solo First-time buying: Anxiety doubles when finding a home with your partner! Stress and anxiety significantly increase when buying a first home with your partner compared to flying solo The likes of searching for a property, applying for mortgages and progressing through the legalities are all significantly…
Read More →
Breaking News

Breaking Property News 28/10/26

Daily bite-sized proptech and property news in partnership with Proptech-X.   If Zoopla is for sale, then so are you Thought leadership by Olivier Jauniaux Founder of NestLink On 14 August, Providence Equity Partners announced it had agreed to acquire Hometrack from ZPG. Bloomberg confirmed the seller the same day. Terms were not disclosed, though Real Deals, citing…
Read More →