ARLA Propertymark and NAEA Propertymark shared their research and predictions for 2018, which included the fact that nearly three in five letting agents believe that rent prices will rise next year in comparison to the 19 per cent who expect them to decrease.
New predictions from ARLA Propertymark found that 59 per cent of letting agents think that rent prices will rise. 62 per cent believe that the supply of rental stock will fall in 2018, whilst 53 per cent are of the opinion that demand will continue to rise. 70 per cent of letting agents expect private rented taxes to continue to rise in 208, as agents begin to alter their business models in order to survive following the Government ban on tenant fees.
Chief Executive of ARLA Propertymark, David Cox, said: ‘2017 was a big year for the lettings industry, and tenants felt the effects of this. Unfortunately, it looks like rising rent costs are going to continue into the New Year as agents need to be moving into a 0 per cent fee business model by October, which will push rents up as the costs are passed through landlords and onto tenants. There is a lot of other regulation making its way through Parliament next year, which will more positively affect the rental market however – including regulation of the industry, housing courts and longer-term tenancies. While these policies will be developed rather than implemented, they should start to affect the market as agents adapt their businesses in anticipation. In terms of the supply of rental properties, which agents largely expect to fall, we need to remember that the minimum energy efficiency standards coming into effect in the New Year could see up to 300,000 properties being taken off the market because they don’t reach the minimum requirements. This will also – in turn – push rent costs up.’
He continued: ‘Overall, the industry is going through a seismic change and the lettings market we know today will be radically altered over the next five years. This change will be painful for agents, but we firmly believe that the industry will come out of the other end stronger, more professional and with a robust reputation among consumers.’
Secondly in the predictions from ARLA Propertymark and NAEA Propertymark are NAEA’s predictions. They found that 43 per cent of UK estate agents expect house prices to fall next year. However, 44 per cent believe supply will remain the same, with just 29 per cent expecting it to decrease. 32 per cent are of the opinion that demand will increase in line with this, although 46 per cent expect it to stay the same.
34 per cent believe that incidents of gazumping will decrease in the New Year too, whilst the trend of renovating as opposed to moving is expected to continue.
Chief Executive at NAEA Propertymark, Mark Hayward, said: ‘It’s been a big year for the housing market, with the Government pledging to improve the house-buying process, and stamp duty relief for FTBs coming into effect. However, looking ahead to next year, more than half of our members don’t think the FTB tax relief will have a real impact on the number of sales being made to the group. Further, agents expect supply to remain the same but demand to grow which sounds like bad news, but if we can improve the process of buying a property, we’ll be making vast improvements to the sector which will ultimately make it easier and provide more certainty for FTBs. Our members want to see stamp duty relief rolled out nationally to all buyers, and hold out hope that housing stock will increase. This will be a case of ‘wait and see’ – the Government has made many such promises in the past which we’ve never seen translated into reality.’