Rents 'spiralling' as landlords head for exit, says RICS

The relentless decline in the volume of new landlord listings shows no signs of abating.

RICS’s monthly UK Residential Market Survey reports that landlord instructions continue to dwindle, with -34% of letting agents reporting a drop in May.

Agents around the UK paint a gloomy picture of the rental market with widespread reports of landlords exiting and a shortage of new homes.

Neil Foster (pictured), at Walhouse Surveyors & Valuers in Newcastle, says rents are spiralling and housing stock is diminishing. “Tax burdens, property regulation and the offer of easier investment choices are combining to shrink the market at the greatest time of need,” he adds.

John Cranmer, at Henley-based John H Cranmer and Company, reports seeing signs of panic from tenants due to supply constriction, as landlords exit the sector.

“When homeless tenants need housing in hotels, pressure groups will realise what damage is being done for ideological reasons,” says Cranmer. “Since the demise of public social housing, the government has relied on the PRS and is now destroying choice.”

More rent rises

Meanwhile, tenant demand strengthened following the softer trend seen in late 2024/early 2025, returning a net balance of +22% - the highest since last September. As a result, the RICS predicts that rents should rise further in the next three months, with the net balance for rental growth expectations jumping to +43%.

Stronger tenant demand and falling supply will only push rents higher, agrees Tom Bill, head of UK residential research at Knight Frank, who believes this is one unintended consequence of the Renters’ Rights Bill.

“As the new rules come into force over the next 12 months, we expect the upwards pressure on rents could intensify if landlords see added risks around the repossession of their property and void periods,” adds Bill.