Demand from new prospective tenants continues to outstrip housing supply in the private rented sector despite a dip in the number of people registering with letting agents, new figures show.

The average number of new prospective tenants per letting agent branch dropped from 83 in September to 71 in October, according to ARLA Propertymark.

The North West saw the highest number of people looking to rent, at an average of 163 potential tenants per branch.

Yorkshire and the Humberside, Wales, and Northern Ireland jointly contain the fewest tenants looking per branch, at 26.

The number of tenants experiencing rent increases dropped marginally in October, with 68% of letting agents reporting that landlords had increased rents compared to 75% a month earlier. This is the lowest since June, where rent increases stood at 60%.

There was also a slight fall in the number of properties managed per agency branch, down from 199 in September to 196 in October, which compares to 213 in October 2020.

In the North East, this figure jumps to 350 in October and, in London, sinks to 69 managed per branch.

Propertymark chief executive Nathan Emerson commented: “The private rented sector remains under pressure. However, demand has fallen for the second consecutive month and the number of tenants experiencing rent increases has fallen.

“There are clear issues with the availability of properties, with some regions, London in particular, being in very short supply of rental stock. This is being exacerbated by the current legislative and regulatory changes taking place, as well as energy efficiency targets, both of which could squeeze landlords and make them consider leaving the market.

“Under this increasing pressure, it is crucial that measures are introduced to retain landlords and incentivise more into the sector.”