The 2024 Goodlord & Vouch State of the Lettings Industry Report reveals a sector facing significant challenges. Key findings from the report, which surveyed over 1,500 letting agents, landlords, and tenants, show that the Private Rented Sector (PRS) is being squeezed from multiple angles.

Key Insights:

1. Landlords Exiting the Market: Around 30% of landlords have sold or are selling properties, with another 17.4% considering doing so within the year. This trend is leading to a reduction in rental supply, pushing rents to historic highs. Over half of letting agents reported a reduction in available properties, with 37.4% describing it as “significant.”
2. Legislative Pressures: Incoming legislation, especially the Renters’ Rights Bill and the abolition of Section 21, is driving over 56% of landlords to reduce or exit their portfolios. Further pressure comes from energy efficiency standards, which 52% of landlords cited as another reason for leaving the sector.
3. Rising Rents and Rent Poverty: Rents continue to soar, with the average rent in England reaching £1,470 per month in July 2024, the highest recorded by Goodlord’s Rental Index. Nearly half of tenants (48%) are spending more than 40% of their income on rent, placing them in rent poverty.
4. Tenant Demand & Market Stress: Tenant demand remains high, with over 75% of agents reporting increased tenant searches. However, this surge in demand has increased stress levels among letting agents, with 33% reporting significant stress and 19% struggling with mental health issues.
5. Pessimism in the PRS: Letting agent sentiment has reached its lowest point, with 54% feeling pessimistic about the future of the sector.

Industry Leaders’ Comments:

• William Reeve, CEO of Goodlord, notes the immense pressure on the PRS and calls for more rental homes and streamlined regulations to address the supply-demand imbalance.
• Tom Goodman, managing director of Vouch, highlights how the challenges facing landlords directly impact tenants and agents, urging a more holistic approach to future reforms in the PRS.

Overall, the report paints a grim picture of the current state of the rental market, with both landlords and tenants facing uphill battles, and letting agents struggling to manage the increased workload amidst market pressures.