Tenancies Are Getting Longer in the UK Property Market

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The Implications of Extended Tenancies for the UK Property Market

As a buy-to-let investor, tenancy length is something you should keep an eye on. Generally, if you have responsible tenants, you’ll want them to stay in your property long. This facilitates a steady stream of rental income and limits void periods when you own a property.

New research shines a light on tenancy length, indicating that tenants are staying in properties for longer.

Let’s look at the details and see what this means for the Private Rental Sector.

Discover More: Read our guides on tax on buy-to-let and how to buy a second home for more need-to-know buy-to-let insights.

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How Much Longer Are Tenants Staying in Properties?

Research from The Deposit Protection Service shows that renters are now staying in their properties for about 30% longer than four years ago. The average tenancy duration has increased from under two years in 2020 to over two and a half years.

During the period, the average tenancy duration was extended by 218 days. The DPS confirmed this increase, stating that it amounted to a rise of just over 30%.

Between March and September 2023, the research found that the percentage of relocating respondents who found moving challenging increased by 6%. Additionally, the proportion of respondents not planning to move rose by 2% during the same period.

The research also noted a 3% increase in respondents who took on an extra job to secure their rental property between March and September 2023.

Furthermore, data revealed that 64% of movers surveyed in September had made financial sacrifices to meet their new rental arrangements, marking a 1% increase since March 2023.

The proportion of respondents paying £501 or more in rent to secure their rental also increased from 8% in March 2023 to 13% in September 2023, according to the organisation.

Find Out More: If you’d like to learn more about property, dive into our guides on how to calculate market value and buying more than one property.

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How Did the Experts React to the Data Regarding Tenancy Length?

Managing Director at The DPS, Matt Trevett, said: “Average tenancy lengths started increasing during the pandemic as a result of government restrictions on moving and, despite the lifting of all restrictions in February 2022, average tenancy lengths have continued to rise.

“Responses to our regular tenant surveys suggest that the combination of competition for new rentals, high rents and other financial issues, as well as tenants acquiring a ‘lockdown pet’ are contributing to renters typically staying for longer in a property.

“Longer tenancies can also increase the likelihood of wear and tear and maintenance issues associated with a rental property; we’d therefore encourage landlords and tenants to keep an open dialogue throughout to ensure concerns are dealt with in good time as well as help avoid any dispute over the return of a deposit at the end of a tenancy due to the property’s condition.”

For more buy-to-let UK insights, see our recent buy-to-let area guides:

Why not learn more about choosing the best areas to invest in property in London with our dedicated guide.

Author

Dale Barham

Dale is a property content writer at RWinvest. Keeping a close eye on the UK property market, Dale helps our readers stay informed and up to date on the latest market news and statistics.