Eight out of 10 letting agents forecast rent rises in 2017
A significant 80% of letting agents predict rent rises next year as the ban on letting agent fees takes effect.
This is despite the fact that in November, the number of tenants experiencing rent increases continued to fall, at 16%, a decrease from 18% in October.
Demand from prospective tenants fell again in November, as the rental market continues to cool ahead of Christmas; 32 prospective tenants were registered per letting agent branch, compared to 34 in October.
However, more than half (53%) of agents expect to see a rise in demand next year.
Rise in supply
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, a third (63%) of agents expect the supply of rental accommodation to decrease in 2017.
David Cox, managing director of the Association of Residential Letting Agents (ARLA), said: “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.
“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.”