The Private Rented Sector (PRS) Report from ARLA Propertymark in March 2018 shows the market holding steady for landlords and agents in the first quarter of 2018, but lack of supply is making life difficult for many tenants.
Recent government policy changes, particularly on landlord taxation, are forcing many landlords to recover their extra costs through rent increases, and as the phased withdrawal of tax relief bites over the next few years, this trend could get worse before it gets better.
Tenant demand consequently remains consistently positive, with the number of prospective tenants registering per ARLA Propertymark member branch increasing by around eight per cent in March 2018. The average number of tenants on agents’ books rose from 61 in February to 66 in March, slightly down on the January figure of 70.
At the same time the supply of rental accommodation also rose slightly with the number of landlords’ rental properties being managed by letting agents up marginally, from 175 in February, to 179 in March, per branch, though again this figure is slightly down, compared to March 2017, which was at 183 on average.
Rent Increases Accelerating
The number of tenants experiencing rent increases rose to 23 per cent in March, the highest increase since September 2017 when 27 per cent of landlords put up rents. However, the figure represents a declining trend year-on-year. In March 2017, 25 per cent of tenants had their rents increased compared to March 2016 and 2015 when the figure was at 32 per cent.
David Cox, ARLA Propertymark Chief Executive said:
“This month’s results very much show a ‘business as usual’ period for the private rented sector, but this isn’t necessarily a good thing. Supply is still too low and almost a quarter of tenants are experiencing rent hikes every month as landlords try to recoup the costs lost trying to keep on top of all the recent legislative changes – including the recent energy efficiency deadline.
“For the last two decades, successive Governments have passed significant amounts of complex legislation for landlords, none of which have been properly policed or adequately enforced – but most of which cost decent landlords a lot of money.
“This is why we’re so supportive of the Government’s proposals to crack down on rogue agents, and more recently, plans to confiscate properties from criminal landlords. The announcements mark a sensible shift towards focusing on the root cause of the issues affecting the sector, rather than trying to find solutions to individual problems. This, coupled with greater rental stock is the key to fixing Britain’s broken rental sector.”
See the full Private Rented Sector (PRS) Report from ARLA Propertymark here