There is a difference between a market having stock and a market having supply, and the rental market is demonstrating it clearly at the moment.
Here is a simple way to see it. In our data at Propalt, take the number of tenancies agreed in an area over the last twelve months, work out the weekly rate, and set it against the number of homes available to rent there today. That tells you how long the shelf would last if nothing else came on.
Across five areas we looked at, it runs between four and seven weeks. Chorlton in Manchester is the tightest at about four. Croydon is the loosest at around seven. Leeds city centre, Canary Wharf and Moseley all sit between five and six.
Different cities, different stock, different price points. Same answer, give or take a fortnight.
The housing stock has not changed. The same houses are standing in the same streets, and almost all of them are occupied by somebody. What has changed is how often any of them become available, and how long they stay that way.
Those two things get confused constantly, and the confusion matters. When people say the rental market is short, the picture in their head is homes disappearing. Mostly they haven't. They are held for longer, they come back to market less often, and when they do they are gone before the listing has settled.
A market can be perfectly well stocked and still have almost nothing you can actually rent this month.
Two things follow, and both run against the received wisdom.
If you are a letting agent, the scarce thing is not tenants and has not been for a while. The scarce thing is instructions. The work that pays is with landlords who are not currently moving, rather than with the applicant list, and most agencies still have the opposite allocation of effort.
And if you are modelling this market, total dwellings is the wrong denominator. What matters is the turnover rate. Turnover has fallen while the stock has stayed put, which means every forecast built on housing numbers alone is measuring something that isn't moving.
Counting houses tells you what exists. It does not tell you what is available, and availability is the only thing anybody actually experiences.
Co-founder of Propalt and a property investor and developer for 20 years
