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The number of buy to let property investors introducing rent price rises to their tenants hit a new record high in June.
More than half of letting and management agents (55 per cent) witnessing landlords making rent price rises. This is a 22 per cent increase from May which was a previous record high.
The latest ARLA Propertymark June Private Rented Sector (PRS) Report also showed that year-on-year the number of tenants experiencing rent price increases is up from 31 per cent in June 2017, and 35 per cent in June 2018.
The record level of rent price increases is thought to be mainly because of the introduction of the tenant fees ban forcing landlords to recover costs through higher rents.
Letting agents had an average of 199 properties under management per member branch in June, a decrease from 201 in May.
However, demand from prospective tenants increased marginally in June, with the number of house hunters registered per branch rising to 70 on average, compared to 69 in May.
Despite fears of a mass exodus by landlords in the private rental sector, the number of buy to let investors exiting the market remained at four per branch, the same figure seen in June 2018.
ARLA Propertymark Chief Executive, David Cox, commented: Unsurprisingly, rent costs hit a record high in June as tenants suffered the impact of the tenant fee ban. Ever since the Government proposed the ban, we warned that tenants would continue to pay the same amount, but the cost would be passed onto tenants through increased rents, rather than upfront costs.’
He continued: ‘In addition to the repercussions of the Tenant Fees Act, the proposed abolition of Section 21, coupled with the Mayor of London’s recent call for rent controls, will only cause the sector to shrink further. In turn this will increase pressure on the sector because it will discourage new landlords from investing in the market, causing rents to rise for tenants as less rental accommodation is available.’