Surprising city tops tenant demand index

A recent analysis by Pepper Money has identified Chichester as the leading city for tenant demand in the UK, surpassing traditionally popular locations such as London and Oxford. The study highlights significant search interest and rental activity across 42 locations, offering valuable insights for landlords and letting agents navigating the current rental market.

Chichester tops tenant demand index

Pepper Money’s tenant demand index reveals that Chichester leads with 659 searches per 10,000 people, far exceeding Exeter’s 369 and Bath and North East Somerset’s 340. This West Sussex city also commands an average monthly rent of £1,201, reflecting its strong appeal to renters despite a notably long average time on market of 389 days.

The index was compiled by analysing search interest, available rental stock, rent inflation, time on market, and average monthly costs by property type across 42 locations. Chichester’s position at the top of the list challenges common assumptions that larger cities like London or Oxford would dominate tenant demand.

Tenant activity and market dynamics

Paul Adams, sales director at Pepper Money, commented on the findings: “Our research highlights strong levels of search interest across 42 locations, alongside very short letting periods.” He noted that semi-detached and three-bedroom homes typically spend 122 and 132 days on the market respectively, indicating that tenants are quick to secure properties in a competitive environment.

Adams emphasised the evolving relationship between landlords and renters, stating: “As this shift in renting continues, there is an opportunity for renters and landlords to work more closely together.” He added that landlords who adapt to renters’ needs—such as offering longer tenancies or more space—are better positioned to attract and retain tenants.

Ranking of other cities in the index

Bath and North East Somerset ranks second with 340 searches per 10,000 people, an average rent of £1,486, and rent inflation of 9.7%. Despite a longer average time on market of 525 days, its high search volume and rising rents place it just behind Chichester overall.

York is third, with 243 searches per 10,000 people, an average monthly rent of £1,055, and rent inflation of 6%. Oxford follows in fourth place, recording 143 searches per 10,000 people, 56 properties available per 10,000 people, an average rent of £1,629, and rent inflation of 7%. Exeter rounds out the top five with 369 searches per 10,000 people, an average rent of £1,130, and rent inflation of 4.3%.

Other cities in the top ten include Chelmsford, Plymouth, St Albans, Winchester, and Swansea, reflecting a diverse range of locations with strong tenant interest.

Areas with lower rental demand

At the opposite end of the spectrum, Salford ranks lowest in tenant demand. It has 204 properties available per 10,000 people—451% above the study average of 37—alongside 165 searches per 10,000 people, an average rent of £1,077, and rent inflation of 6.1%. Its average time on market is 193 days.

Peterborough is second from bottom despite having the quickest turnover, with properties on the market for just 153 days. Leeds is third from bottom, with 123 searches per 10,000 people, 120 properties available per 10,000 people, an average rent of £954, and rent inflation of 3.1%. Newport and Coventry complete the five lowest-ranking locations.

Rental stock and pricing insights

The analysis also shows that semi-detached homes spend an average of 295 days on the market across the studied locations, while three-bedroom homes are let more quickly, averaging 280 days. London remains the most expensive city for tenants, with an average monthly rent of £2,247—31% higher than Oxford, the second priciest location.

Southend-on-Sea stands out for its limited rental stock, with only six properties available per 10,000 people, highlighting the variation in supply across different areas.

What this means for landlords

Landlords should note the strong tenant demand in cities like Chichester and Bath, where high search volumes and rising rents indicate competitive markets. However, longer times on market in these areas suggest that pricing and property presentation remain critical to securing tenants promptly.

Adapting to tenant preferences, such as offering longer tenancies or larger homes, could enhance landlord success in attracting reliable tenants. Conversely, in areas with high stock levels but lower demand, landlords may need to consider more flexible strategies to reduce vacancy periods.

Source: Based on reporting from Property118

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