Fewer residential tenants in the UK saw their rents rise in November but eight in 10 lettings agents expect rents to rise in 2017, new research has found.
Overall some 16% of tenants experienced rent increases last month, down from the 18% recorded in October, according to the latest monthly report from the Association of Residential Letting Agents (ARLA).
But it all says that following the Chancellor of the Exchequer’s announcement to ban letting agent fees for tenants during his Autumn Statement some 80% of its member agents expect to see rent hikes in 2017.
The report also shows that demand from prospective tenants fell again in November, as the rental market continues to cool ahead of Christmas. There were 32 prospective tenants were registered per letting agent branch, compared to 34 in October. However, more than half, some 53%, of agents expect to see a rise in demand next year.
In November, the number of rental properties managed per branch was 185, an increase from 180 in October. However, this is considerably lower than the level seen in September, when there were 193 properties managed per branch.
Following the increase in taxes for landlords, including stamp duty and capital gains tax, 63% of agents expect the supply of rental accommodation to decrease in 2017.
‘The number of rent hikes reported by letting agents continued to decrease in November, and it’s a shame the ban on letting agent fees will have the opposite impact on rent prices when the measure comes into force,’ said David Cox, ARLA managing director.
‘The buy to let market is becoming less attractive for investors as the ban on fees, combined with the scrapping of mortgage interest relief and the stamp duty increase on second homes push costs up for landlords. So unfortunately, regardless of the uplift we saw in supply this month, we expect to see the number of properties available to rent fall next year,’ he added.
