The supply of rental properties fell by 8% from December to January, according to the January PRS Report by ARLA Propertymark. The number of properties letting agents managed fell to 184 per branch compared to 200 in December 2017.

As aresult of falling supply, the gap between supply and demand widened in January with more prospective renters entering the market. On average, letting agents registered 70 prospective tenants per branch in January, compared to just 59 in December.

Landlords also kicked-off 2018 with contract negotiations as one in five (19%) tenants experienced rent hikes in January, compared to 16% in December. However, this percentage of landlords increasing rents is lower than a year ago when 23% of tenants had their rents increased, and 30% were subject to rent rises in January 2016.

David Cox, ARLA Propertymark chief executive, said: “Housing stock is falling as rising taxes continue to force established landlords out of the market and deter entry into the sector – and the volume of renters is increasing as the cost of buying a home is moving further out of reach for many. Ultimately, until the prospect of investing in the buy-to-let market is more attractive for prospective landlords, and stock subsequently increases, tenants will continue to feel the burn.”