Letting agents pessimistic over Buy to Let changes
Four in ten letting agents are predicting rental stock supply will fall over the next five years – the highest propertion of agents to predict so this year, according to the Association of Residential Letting Agents (ARLA).
According to the report fewer agents are reporting rent increases, 23% for November, the lowest proportion this year, which is good news for tennants looking to save for deposits.
However supply and demand of rental properties both increased in November, which the report puts down to a result of tenants preparing themselves to find new rental properties in the New Year. ARLA agents registered an average of 34 new tenants per branch this month, up from 33 in October.
Supply of rental accommodation rose by nine per cent in November, from an average of 173 properties managed per branch in October, to 189 this month.
David Cox, managing director, Association of Residential Letting Agents (ARLA), says: “This month’s findings are triggered the Chancellor’s announcements around buy-to-let (BTL) tax in his Autumn Statement.
“When the rabbit was first pulled out of the hat, we said these changes would be ‘catastrophic’ for the rental sector and this has been echoed by letting agents across the country. The new stamp duty increases will make owning a BTL unprofitable for a lot of landlords, and certainly make new investors think twice about purchasing a BTL property.
“It’s promising to see that the number of agents reporting rent increases is continuing to decline, and this should spread some Christmas cheer amongst renters renewing tenancies or looking for a new property to rent.
“However, just under a quarter of tenants are still unfortunately seeing hikes in their monthly rent payments. But if we continue to follow trends we’ve seen in previous months, we should see fewer tenants experiencing increases as we welcome in 2016.”