So, one months on from the introduction of The Tenant Fee Act and already it is playing out as expected.
The Association of Residential Letting Agents(ARLA) has reported the highest recorded rise in rents for the month of June 2019. This information is received from member agents nationwide. Attached is David Cox statement. For me, rent increase aside, the real story here is that rental supply is falling.
David Cox, ARLA Propertymark chief executive, said: “Unsurprisingly, rent costs hit a record high in June as tenants suffered the impact of the tenant fee ban.
“Ever since the Government proposed the ban, we warned that tenants would continue to pay the same amount, but the cost would be passed on to tenants through increased rents, rather than upfront costs.
“In addition to the repercussions of the Tenant Fees Act, the proposed abolition of Section 21, coupled with the Mayor of London’s recent call for rent controls, will only cause the sector to shrink further.
“In turn this will increase pressure on the sector because it will discourage new landlords from investing in the market, causing rents to rise for tenants as less rental accommodation is available.”
Separately, haart has reported rental supply down by 19% last month compared with July 2018, and in London, down by 37%.
Is it me, or does this statement shout out that we should be investing in buy to let properties? Roughly translated it says to me…rents are going up, rental stock is quickly shrinking, meaning a number of previously rented properties are available to buy. Regulation may be increasing, but with the aid of a competent letting agent, that shouldn’t be a reason to not become a landlord.
With professional bodies playing down being a buy to let landlord this surely further cements what a great opportunity it is to enter the sector.