Tenants have shifted their hunger for a new home to the countryside and the suburbs rather than the city, creating a big gap in rental demand.
Rental asking prices in out-of-town and suburban areas have jumped 11 per cent, compared to 2 per cent in urban areas, Rightmove data shows.
It compared the asking prices for more than 300,000 rental homes on its website in February 2020 with August 2021.
This three-bedroom house in Upper Sheringham, Norfolk, can be rented for £1,100 a month via Brown & Co letting agents
London and city locations are seeing less demand than out-of-town areas from tenants
The shift follows the trend seen in the homebuyer market where demand for rural homes soared during the pandemic’s race for space and remote working.
Rightmove said that in the rental market, average asking prices in surburban areas had reached £1,041 a month, up from £940 in February 2020, an increase of £101.
At the same time, rents in rural areas are up from £1,141 a month to £1,264 a month, an increase of £123.
Meanwhile, rental asking prices in urban areas are up by £25 during the same period, from £1,347 to £1,372.
Demand for more outdoor space among tenants has seen greater competition for rental properties in the countryside and the suburbs.
Rightmove said the number of homes available to rent in the suburbs has dropped 45 per cent compared to pre-pandemic levels. At the same time, the figure is down 61 per cent in rural areas.
It said tenant demand for each rental property in the suburbs has risen 155 per cent compared to pre-pandemic levels and is up a huge 224 per cent in rural locations.
Only 3 per cent of the rental properties listed on Rightmove are now in rural locations
This two-bedroom house in Mount Ambrose, Cornwall,is available to rent for £70 a month via letting agents Trelawny
Darren Ellis, of lettings agent Bradleys Group, said: ‘Across our offices, which cover Somerset, Devon and Cornwall, the demand for properties in rural and semi-rural areas has reached fever pitch, with multiple applications for almost every property since the start of the year.
‘As a result, tenants are offering above market prices to secure a property, and landlords can choose the application that best suits their position.
‘The shortage of available homes, whether it be flats or houses, means landlords are experiencing short void periods.
‘While the market cooled very slightly towards the end of the summer, this appears to only reflect the lack of property, and not the demand from tenants, so it is likely this market will carry on for the foreseeable months over winter.’
This three-bedroom detached bungalow in Roselea, in Scotland, is to let for £750 a month by agents Galbraith
Rightmove went on to explain that 64 per cent of the rental properties listed on its website are now in urban locations, up from 48 per cent since February 2020.
The proportion of available properties that are in the suburbs has dropped from 46 per cent to 33 per cent, while rural areas have declined from 6 per cent to just 3 per cent.
Competition for available rental properties has also increased in urban areas compared to before the pandemic – although significantly less than in suburban and rural areas – at 82 per cent.
The high levels of competition for rental homes in the countryside means that the average rental property in a rural location finds a tenant 18 days more quickly than before the pandemic.
Suburban properties find a tenant two weeks more quickly, and urban rentals find a tenant five days faster.
This three-bedroom semi-detached house in Aldercroft, Cumbria, is available to rent for £900 a month via letting agents Milne Moser
Tim Bannister, of Rightmove, said: ‘A notable impact of the pandemic on the rental market has been the change in distribution of available properties between urban and suburban areas.
‘While the proportion of homes available to rent in urban and suburban areas remained steady in the years leading up to the pandemic, the data shows a significant change in 2020 as more renters looked to the suburbs.
Letting agents report that prices have increased amid fierce competition for rental homes in rural locations.
‘A desire to relocate and move to a home with more space has meant that demand has greatly outstripped supply in these areas and also in rural locations, which in turn is propping up asking rents.
‘Now that more people are returning to offices at least part of the week, we’d expect to see greater demand for urban rentals over the coming months as more people need to be closer to work.
‘However, the scale of change we’ve seen over the course of the pandemic means this shift isn’t going to happen overnight, and it will be interesting to continue to monitor the lasting impacts of the pandemic on demand in the rental market for the rest of the year.’