If you’re trying to find somewhere new to rent in London right now, you’ll probably already have first-hand experience of just how tough the market is, thanks to a situation where demand for houses vastly outstrips the supply, leading to bidding wars between potential tenants becoming commonplace.

Now, a new report has confirmed the scale of the capital’s rental supply problem, with one spokesperson describing it as “disastrous”.

According to the study from the London School of Economics and estate agents Savills, rental listings have declined across the city since the pandemic, with the number of one, two and three-bedroom properties listed to rent in inner and outer London declining by around 36% since the coronavirus pandemic. By comparison, the number of listings dropped 33% nationally.

Researchers calculated the decline by comparing the number of London listings available between January and March 2023 to the January to March average from 2007 to 2019.

Listings for four-bedroom properties in London declined the most, with availability reduced by almost 47% in the same period.

While the availability of private rental properties has dropped, asking rents are 20% above the pre-Covid level.

Labour councillor Darren Rodwell, spokesperson for London Councils, described the research as “the latest evidence of how the capital’s broken housing market is worsening the unsustainable and increasingly unmanageable pressures we face in London”.

“A bad situation is now becoming disastrous,” he added. “We’re seeing fast-rising private rents and reduced availability of rental properties against a backdrop of continuing cost of living pressures and London’s longstanding shortage of affordable housing.

“Homelessness is a national emergency but with London accounting for two-thirds of England’s temporary accommodation placements, we are at the epicentre of this crisis. Urgent action is needed from the government to help households avoid homelessness and to reduce the number in temporary accommodation.”

Savills director Abigail Davies noted that the “triple whammy of rising costs of borrowing, greater exposure to tax and regulatory changes” has caused many private landlords to leave the sector in recent months, “putting downwards pressure on supply against ever-rising tenant demand”.

“Without doubt, this will compound the problems faced by lower-income households and points to the need for policy that favours the delivery of affordable homes across the capital.”

Higher rents are impacting how long first-time buyers need to save up for a deposit, with recent research from Generation Rent discovering that it now takes almost a decade for the average person to achieve this.

In London, though, it takes even longer, with first-timers saving up for 18.3 years on average.

Positive change in the sector could be on the way in the form of the Renters Reform Bill, which was tabled in parliament last month.

It would abolish no-fault evictions, make it easier for tenants to have pets in their rented homes and establish a private rental ombudsman service to adjudicate between landlords and tenants. 

However, this isn’t a catch-all solution, especially when the supply and demand issue is so deeply rooted – and some members of the landlord lobby have even claimed that the bill might cause yet more of them to sell up.

It’s certainly a tough time to be renting, so it’s vital to remain aware of your rights. If your landlord is trying to increase your rent, make sure you’ve checked your contract carefully – they can only increase the rate during the fixed term of a tenancy agreement if your contract includes a specific rent review clause allowing this. Organisations like Citizens Advice and Shelter can also provide you with free, impartial advice. 

Images: Getty