More than a Quarter of Letting Agents Seeing Rents Rise
Over a quarter of letting agents saw rents rise in May – the highest level since last July, according to ARLA Propertymark (the Association of Residential Letting Agents).
The organisation’s May Private Rented Sector Report found that 27% of letting agents saw rents rise for tenants in May, which is the highest level recorded since July 2016, when 28% experienced growth in rents.
For the second consecutive month, just 2.8% of tenants successfully negotiated a rent reduction. This figure had increased to 3.6% in March, but it appears that their bargaining power is now decreasing.
Meanwhile, the supply of rental stock increased to an average of 189 per member branch in May – up by 11% on last year, when this figure stood at 171.
The increase in rental stock is owed in part to the drop in the number of landlords selling up in May, with agents reporting three sales per branch, down from four in April.
The Chief Executive of ARLA Propertymark, David Cox, comments on the latest report: “Private rents rose by 1.8% in the 12 months to May 2017, and the last thing tenants need is for them to get even higher.
“With the new Government confirming a Tenants’ Fee Bill in the Queen’s Speech, we can expect them to rise by up to £103 a year, hitting loyal tenants looking for long-term agreements hardest. This is on top of any natural organic rent growth as well.”
He adds: “The only thing which could offset this would be to significantly increase rental stock, but, until this happens and supply and demand meet in the middle, rents will only become more and more unaffordable.”
A cap of one month’s rent on tenants’ security deposits was also announced in last month’s Queen’s Speech, which followed the controversial General Election result.