Across the UK by region and price band, demand for rented homes has surged by 30% since 14 April 2020, suggesting the rental market is regaining momentum, according to Zoopla’s latest Rental Market Report.
This follows an initial decline of 57% in the two weeks to 30 March, driven by the coronavirus crisis.
In the same period, the sales market was hit by a 70% decline in buyer demand. However, rental demand is still 42% lower than at the start of March.
There has been no mass withdrawal of properties listed to let, as the total number of properties listed as available remains broadly unchanged, down just 3% compared to 1 March.
The research also found that the number of moves per year in the lettings market is expected to drop by 25% in 2020 compared to 2019.
Rental supply has increased ahead of the lockdown as landlords switched from the short to the long-let market, but growth in new supply has since slowed.
Annual rental growth in the UK stands at +2.4%, up from +1.5% in March 2019; rental growth is expected to moderate over the rest of the year, but remain in positive territory.
City-level annual rental growth ranged from +5.9% in Nottingham to -2.1% in Aberdeen. Annual rental growth in London is running at 1.7%, down from 2.3% in the previous quarter, but broadly in line with the same period in 2019 (1.8%).
Excluding London, the most popular price band tenants are engaging with online across the UK is £500 to £600 per calendar month; this is consistent with trends before the impact of COVID-19. In London, where February saw tenants most focused on the £1,400 to £1,500 bracket, April showed that £1,200 to £1,300 had become the most popular.
Gráinne Gilmore, head of research at Zoopla, said: “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.
“The rise in demand in the first two weeks in April indicates that some tenants are already mapping out their next move.
“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.
“Rental growth has increased steadily for the last three years as demand has increased in the face of dwindling new supply.
“However, 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.”