Demand for homes to rent has surged back by some 30 per cent in the two weeks to April 14 according to data released by Zoopla.
An extensive piece of research released by the portal company says the impact of Coronavirus has been less pronounced in the lettings market compared to the sales market.
While demand for rental properties fell by more than 55 per cent between March 7 and March 30 there has been a continuation of activity with agents agreeing rental contracts with delayed start dates and, in some cases at least, based on online viewings.
Zoopla predicts that activity levels are likely to rise more quickly in the rental market than the sales market once the lockdown eases, given that the average ‘time to let’ is less than three weeks in usual market conditions, compared to the three months average to complete a sale.
The portal suggests that post-lockdown activity levels will likely rise and match previous years’ levels in the typically busier seasonal periods in Q3 and Q4, meaning that the total number of moves within the rental sector will be approximately 25 per cent lower than in 2019.
The Zoopla rental index shows that the annual rate of UK rental growth flattened in March – reflective, it says, of seasonal trends rather than ramifications of the lockdown. Rents were up 2.4 per cent on the year, compared to 2.5 per cent annual growth in February and the 2.3 per cent recorded in December 2019.
Despite the slight slowdown in growth, rental growth has been on a largely upward trajectory since March 2017 amid increased demand and shrinking supply.
“The flexibility of the rental market is one of the key factors which has allowed activity to bounce back more quickly than other parts of the property market” says Zoopla research head Gráinne Gilmore.
“As with the whole housing market however, activity levels and rental growth will likely be closely aligned to the economic landscape of the UK once the lockdown eases and the immediate impact of COVID-19 starts to recede” she adds.
“If the responses to COVID-19 contribute to a rise in unemployment, as some official bodies have forecast, this will reduce the scope for any additional growth in rents. We expect growth to moderate this year, but to remain in positive territory.”
By Graham Norwood