The latest Private Rented Sector (PRS) report from the Association of Residential Letting Agents (ARLA Propertymark) shows that landlords are responding to the squeeze on their income by passing on at least some of their increasing costs, by way of rent increases.
Around one-third of member letting agents surveyed in July 2017 saw rents increase for tenants, which has increased from just 27% of their agents seeing rent rises in May.
In July ARLA report that the number of properties managed per member branch had increased marginally, to 192 – up from 190 in June, while demand from prospective new tenants had continued to increase.
Private landlords are being faced with a stark choice: either increase rents to offset the increased costs they are face with, due to recent tax rises, or think again about selling the rental property. This latter is happening in some cases and is adding further to the shortage of rental property and pushing up rents still further.
David Cox, ARLA Propertymark chief executive, reports:
“Landlords really are stuck between a rock and a hard place.
“All the tax increases they’ve incurred over the last 18 months have meant they either need to sell their properties and exit the market, or increase rent payments to plug the deficit.
“Neither of these outcomes benefit tenants; if they exit the market, supply is even more strained and matched with growing demand, rent prices will increase anyway.
“Government may claim they are helping tenants but the unintended consequences of their actions on the private rental sector are now really being felt by tenants in terms of lack of homes to choose from and the feeling of being constantly priced out of the market. This needs to change.”