Tenant demand has reached a new all-time high, said Paragon Bank, surprassing the previous record set earlier this year.

The buy-to-let lender said that 65% of landlords reported a net increase in tenant demand over the past three months, beating the high of 62% set at the start of 2022.

This marks a significant rise in tenant demand compared to the net increase of just 14% recorded in the second quarter of 2020 (although this covered the lockdown period).

In addition, 39% of landlords said that demand from tenants had increased ‘significantly’, the highest proportion since the metric was first tracked in 2011.

Only 1% of landlords felt tenant demand had ‘decreased slightly’, while none said it had ‘decreased significantly’, a first for the long-running quarterly survey.

Moray Hulme, mortgage sales director for Paragon Bank said: “We’ve seen demand for privately rented homes climb consistently since the pandemic. The fact that the all-time high we reported earlier this year has now been surpassed supports our view that the private rented sector remains an essential component of UK housing provision.

“Renting appeals to people of different demographics and from all walks of life but the flexibility and relative affordability of rented accommodation means its value is even more apparent at what is an economically challenging time for many.”

Regional breakdown

At a regional level, Paragon saw strong tenant demand reported in all areas of England and Wales. It noted a trend in the South West, Wales and Outer London of landlords reporting strong tenant demand during every quarter so far in 2022.

Increased tenant demand was recorded by 88% of landlords in the South West and by 84% of landlords in both Outer London and Wales in the third quarter of this year.