The direct effect of the Tenant Fees Ban is playing out in the form of renting increases, where the costs are simply being transferred from fees to rents, as was widely predicted.
ARLA Propertymark’s latest (July 2019) Private Rented Sector (PRS) report indicates that average rents are rising and that UK rents reached a new record high for the third month on the run.
Given their increased costs, more landlords than ever are pushing for rent increases, with around 63% of agents being asked to increase, bringing the number of tenants facing rent rises to the highest figure on record. 15% more landlords increased rents since June, which was itself a record high month.
ARLA report the number of tenants seeing rent increases up 31% since July 2018 and the West Midlands being the worst affected with 86% seeing a rent increase.
David Cox, Chief Executive of ARLA Propertymark, has said:
“Following the Tenant Fees Act coming into force in June, rents have continued to rise, which we believed would happen,”
“The fees agents have been banned from charging are still being paid for by tenants, however it’s now through their rent, rather than upfront costs.
“The fall in the number of properties available further increases competition in the market, which only pushes rents up or forces landlords to exit the market entirely. As the sector faces increased levels of legislation, it’s evident this is putting even more pressure on the industry.”