The vast majority of letting agents – 80% – predict rents to rise next year, partly as a result of the government’s decision to ban tenants from paying letting agents’ fees.
A market survey put out by The Association of Residential Letting Agents (ARLA), reports that four in five agents believe rents will increase in 2017.
However, rental demand was down in November, with less demand from potential tenants. Despite this, 53% of letting agents forecast an increase in demand over the next 12 months.
The number of rent hikes went down again in November, but agents say that when the ban on letting agents’ fees for tenants comes into force, this trend will change.
The buy-to-let market is set for a potential slowdown, as the industry has been hit by a wave of measures introduced by the government in an attempt to slow investor
activity.
Changes to mortgage interest relief will take affect from April 2017, while the scrapping of the wear and tear allowance and the extra 3% stamp duty surcharge on second homes have each taken a toll.
If potential investors are deterred from investing in property, this may mean fewer rental properties on the market for tenants. This will limit accommodation options for tenants and may contribute to rent rises.
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Letting Agent Today