The latest market insight by Zero Deposit, the tenancy deposit alternative, has shown that rental market turnover is as low as 10% in some UK postcodes, with low tenant demand impacting the margins of both letting agents and landlords alike.
Zero Deposit’s analysis of rental market turnover by postcode* shows that on average, 78% of all UK rental market stock is currently let to the nation’s tenants.
However, while the market as a whole may be benefitting from a high level of tenant demand, this isn’t the case in every postcode.
In fact, three of the postcodes with the lowest rental market turnover are all found within the same city – Leeds.
In the LS3 postcode, just 10% of rental stock is currently let, climbing to just 11% in both the LS4 and LS6 postcodes.
Low rental demand isn’t an issue confined to Leeds alone, with the top 10 also consisting of postcodes from Nottingham (NG1), Gwynedd (LL57), Plymouth (PL6), West Lindsey (LN2), Rhondda Cynon Taf (CF37) and Warwick (CV31) – with rental turnover sitting at between 15% to 20%.
So while some letting agents may have the pleasure of tenant waiting lists allowing them to let properties within hours of listing them, many more face the tough challenge of finding suitable tenants to fill the stock on their books.
Sam Reynolds, CEO of Zero Deposit commented: “For the large part, rental properties are in high demand, but as with all aspects of the property market, this metric can differ drastically from one postcode to the next. Tenants are able to be more selective and it’s unsurprising there are growing instances of late stage drop outs where a superior property becomes available.
“We’ve found that 79% of tenants opt for Zero Deposit versus a cash deposit when given the chance and so the ability to offer such an option is just one tool in the arsenal of letting agents when it comes to providing access to the whole market for their landlords. The upfront cost to tenants starts at just £7.50 plus setup fee, so significantly more attractive than other options.
“Not only does it allow them to remove the initial barrier to renting, thus increasing demand, but it can also help to streamline the end of tenancy process, meaning agents can get their stock back on the market and find a new tenant more quickly.”
