Market hot-spots and cold-spots identified by new index

The latest rental market snapshot from lettings agency Barrows and Forrester has revealed the hottest location for tenant demand.

It says Dorset is currently the hottest spot in terms of current tenant demand, but that Herefordshire is leading the pack when it comes to quarterly growth. 

The latest index for Q2 2023 shows that 35.6 per cent of England’s rental stock has already been snapped up by tenants. 

This marks a marginal nationwide decline in demand versus the first quarter of the year, down 0.2 per cent and a 3.5 per cent annual reduction. 

In terms of the hottest spots in England’s rental market, Dorset tops the table with current rental demand sitting at 59.3 per cent.

In West Sussex, demand measures 58.1 per cent and tenant appetites are also strong in Rutland, Somerset and Wiltshire - all well over 50 per cent.

On the other hand, the coldest spots for rental demand in Q2 2023 are Leicestershire, Merseyside and Nottinghamshire - 25 per cent or less.

In terms of quarterly growth, the Midlands is leading the way with the biggest increase being recorded in Herefordshire, followed by the West Midlands, Tyne & Wear and Northumberland.

The local market to have seen the biggest annual growth is Rutland where rental demand is up 7.8 per cent compared to this time last year.

The largest annual drops in demand have been recorded in the City of Bristol, Warwickshire and Nottinghamshire.

Managing Director of Barrows and Forrester, James Forrester, comments: “Topline demand for rental homes has remained largely static during the second quarter of this year and this suggests that many tenants are sitting tight during times of economic uncertainty. 

“That said, the market is generally in a state of limbo during this time of year as many tenants have already made their move whether it be for education or work purposes. 

“There remains, however, a strong level of demand in many areas and this is encouraging news for the nation’s landlords. While the success of a buy-to-let investment may be primarily focussed on the yield available, it’s also about finding consistency with tenants and avoiding void periods.

“It will be interesting to see what impact the incoming Rental Reform Bill will have on rental stock and, therefore, demand when it becomes more difficult to execute no-fault evictions.”

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