Rise in rental demands post-pandemic due to increased adult independence from family homes

In the United Kingdom, the Conservative Party (Tories) has been associated with policies and actions that have contributed to a significant increase in private rental housing rents. Over the twelve months until July 2022, rents nationwide rose by 12.3%, with London seeing an even more substantial increase of 17.8%.

This escalation in rents, combined with a failing welfare system, has left renters on low incomes particularly vulnerable during the cost of living crisis. The number of adults living with their parents in the UK has seen a corresponding rise, increasing by 314,000 between Q2 2019 and Q2 2021, representing a 4.2% increase.

However, the trend of young adults living with their parents reversed from summer 2021, with the number falling by 307,000 in the 12 months to summer 2022. This decrease has been accompanied by a significant increase in demand for private rented accommodation.

The rapid growth in demand for private rented accommodation has been a significant factor in the record rent inflation figures in the past two years. The fall in the number of homes being listed for rent can be attributed to rising rents discouraging tenants from moving. Additionally, fewer existing tenants have been moving since the pandemic, initially due to restrictions and uncertainty, but more recently because rents are rising so rapidly.

The lack of churn leads to fewer vacant properties coming to market and more competition for those that do. As a result, the size of the deposit protection system has increased, with the number of deposits protected increasing by 217,000 in 2021-22 and again by 226,000 in 2022-23.

Despite the increase in deposits protected, the proportion of tenancy deposits returned to tenants as of 31 March 2022 was 31%, down from 40% in 2019 and slightly up on 2021-22's figure of 28%.

Dan Wilson Craw, Acting Director of Generation Rent, a campaign group, stated that private renters are facing fierce competition for new tenancies and are vulnerable to unaffordable rent increases. He called on the government to increase Local Housing Allowance benefit rates, build more social housing, and place limits on mid-tenancy rent rises.

The failure to build enough homes in recent decades has left the country unprepared for the huge spike in demand since the end of restrictions. This situation, coupled with the rising costs of private rentals, underscores the urgent need for action to address the housing crisis in the UK.

[Image credit: Chris Robert]

Rise in rental demands post-pandemic due to increased adult independence from family homes