High level of competition for rooms to let

The shortage of rental accommodation is most severe in London, where there are nearly nine potential tenants for every room that is available in a flat or house share, according to rental website Spareroom.co.uk.

People looking to rent in Luton also face stiff competition, with 8.8 renters chasing every room, while the situation is only slightly better in Cambridge and Milton Keynes, where there are 7.9 and 7.4 people respectively for every room that is available.

There are at least six potential renters for every room that is advertised in Portsmouth, Oxford, Watford and Swindon, while there are at least five people per room in York, Brighton and Norwich.

The group said the level of demand was so high in many towns, that new rental properties were being snapped up within hours of being advertised.

Demand for rental accommodation has soared since the credit crunch struck, as would-be buyers are having to delay house purchases while they raise the high deposits lenders are currently demanding.

Others are adopting a “wait and see” approach until the outlook for both the housing market and the wider economy becomes clearer.

But the same problems in the mortgage market that have prevented many people from buying a home are also restricting landlords from expanding their portfolios, exacerbating the mismatch between supply and demand.