WTF is going on with the UK rental market?

One in seven tenants in the UK were hit with a rent increase over the past month, according to the charity Shelter. That’s more than 1.1 million people. And while the headlines usually focus on the crisis in London – and trust us, it’s happening – other cities across the country are also impacted.

The average rent outside of the capital has just hit a record high, reaching an average of £1,162 per month between July and September. Thanks to a shortage of properties and soaring inflation, renters are being priced out of homes, properties are being snapped up before viewings and bidding wars now appear to be commonplace. Add to that ridiculous food prices and higher energy bills, and it’s not exactly a great time for Generation Rent.

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Everyone has heard the same absurd stories from an unlucky friend who’s tried to move over the past few months. ‘As it got closer to moving day, it got increasingly stressful,’ says Georgia Evans, Time Out’s deputy commercial editor, who recently navigated the east London rental market with some degree of success. ‘You have to expect to pay more than the listed price because of bidding wars. Because rents are higher, you need to have a higher deposit too. You have to widen your search area and contact all of the estate agents, and act really quickly. If you find a place on Rightmove or Zoopla, it would be gone the next day.’

It’s a story that’s playing out not just in London, but all over the country. ‘Some cities in the UK are seeing bidding wars, with landlords able to pick and choose tenants who can pay six or twelve months upfront, meaning less stock for most of the market,’ says James Maguire, of renting guarantor service Housing Hand. ‘This is very prevalent in student lettings in certain cities.’ 

More than 500 people applied to rent a one-bed flat in central Glasgow within hours of it being listed

Data from estate agents Barrows and Forrester shows that average rents increased by 17.1 per cent in Manchester in a year, from £817 in August 2021 to £958 in 2022. London saw average rises of 17.3 percent, Glasgow 18.3 per cent and Newcastle 16.7 per cent.

It’s safe to say that things have gone a bit wild. Earlier this month, more than 500 people applied to rent a one-bed flat in central Glasgow within hours of it being listed by estate agents Pacitti Jones. According to The Times, it was leased just hours after the first viewing after tenants put in offers hundreds of pounds over the asking price of £895 a month. Meanwhile, a road in Liverpool has turned into a ‘ghost street’ after several people were forced to leave their homes due to a sudden rent increase of more than £200 per month. 

‘Every day we hear from people not just in London but across the country who are battling increasingly unaffordable rents and being asked to jump through extreme hoops to secure a home,’ says Polly Neate, chief executive of Shelter. ‘Tenants are being pitted against each other as demand for private rentals has ballooned over the years.’

According to trade body Propertymark, an average of 13 prospective tenants are lining up for every rental out there. Tenant demand is up 20 percent year on year, but the available rental properties are down 9 percent, according to data from Rightmove. Inner-city studio flats are seeing the highest surge in interest across the UK (looks like your fantasy about living alone with ten cats is going to have to wait another year). 

Every seven minutes a private renter in England is served with a section 21 no-fault eviction notice 

Then there’s the whole issue with no-fault evictions which means tenants in England and Wales can still effectively be kicked out for no reason (plenty of horror stories have been circulating about tenants being kicked out, only to see their property on the market shortly for triple the rent). Every seven minutes a private renter in England is served with a section 21 no-fault eviction, with nearly 350,000 private renting adults in England affected between July and August 2022, according to Shelter. 

So, why the hell is the market so overcrowded right now? Well, there are a few likely theories. One is that lots of people have moved back into cities after the nationwide lockdowns eased. Another is that British universities have been accepting more new students. Meanwhile, the lack of properly affordable social homes has pushed people into private renting as the only option. And thanks to house-price inflation, it’s also a hell of a lot harder for first-time buyers or people on lower incomes to get out of the renting cycle. 

All of this has created a perfect storm: a private rental market that just keeps on getting more competitive. And things have been made even worse (yes, even worse) because the UK government currently has no policy on the raising of private rents, little to no protection for tenants, and has also failed to clampdown on the poor quality of many properties out there.

270,000 people are currently on the streets or at risk of losing their homes in the UK right now

As a result, increasing numbers of Brits are looking for alternative living arrangements, such as houseboats and property guardianships. Some renters have been forced to move back in with their parents. Others have decided to sack off the UK altogether and move abroad. Of course, the dark but very real side of all this is the threat of homelessness – with around 270,000 people currently on the streets or at risk of losing their homes in the UK right now.

So what can be done about all of this mess? There are plenty of ways that renting could be made less of a nightmare, but whether anything will actually happen is a completely different story. ‘The government must urgently bring forward the Renters’ Reform Bill to make renting fairer and finally ban no-fault evictions,’ says Neate. ‘And to stave off a wave of homelessness this winter, the government needs to take emergency action and unfreeze housing benefits to help people pay their rent.’

That Renters’ Reform Bill she mentions was first promised years ago, and although it has finally been revealed (with key measures including banning no-fault evictions, creating a national register of landlords and giving local authorities more power to protect renters’ rights), there’s still no date set for when it will become law. In Scotland, emergency legislation has recently been passed to freeze rent and ban evictions until March next year. Mayor of London Sadiq Khan has also made repeated calls for the government to bring in a rent freeze this winter – with no success so far. So, for the majority of the UK, we’ll just have to suck it up. And maybe stop spending all our money on avocado toast and flat whites, as columnists at certain national newspapers keep advising us.