Tenant demand has risen in 2022 to hit the highest level recorded since 2011, according to Paragon Bank.

The buy-to-let lender found that the number of people seeking privately rented homes has grown consistently throughout the course of the Covid pandemic.

The 62% of landlords who reported increasing tenant demand in the first quarter of 2022 is double that of the same period a year ago. And it’s almost four times the level reported in Q1 2020, when only 16% of landlords felt that demand was growing.

Over 700 landlords were asked to assess tenant demand over the previous three months. A ‘significant increase’ was seen by 34% of respondents, with a further 28% reporting slight increases.

Perceived decreases in tenant demand, both significant and slight, were recorded by just 3% of landlords, the lowest on record.

London calling

Increasing tenant demand was reported by 84% of landlords operating in Central London, a substantial increase on the 12% seen in Q1 2021. This places Central London alongside the South West and Wales as the regions seeing the highest levels of increasing tenant demand during the previous three months.

Moray Hulme, mortgage sales director for Paragon Bank said: “Another record high in the proportion of landlords reporting increasing tenant demand reaffirms the need to increase the supply of homes in the private rented sector.

“There is evidence of landlords exiting the sector with many citing increasing tax and regulatory requirements making their lettings business more arduous to operate.

“While it is clearly important that landlords are taxed appropriately and the sector is regulated to ensure high standards are maintained, we must ensure that buy-to-let remains attractive enough to investors who are vital in supplying the properties needed to meet demand.”