Tenants living in some of the most deprived areas in England will face some of the steepest rent price hikes in the country, according to new research by a leading PropTech company.
Goodlord analysed 30,000 tenancies processed through its software platform for letting agents so far this year to assess the impact the proposed Tenant Fees Bill might have on tenants, and whether it could deliver on its objective of helping renters across England.
The study found that tenants moving home are required to have on average £3,039 available per property.
This includes the first month’s rent, at an average of £1,092, security deposit at £1,442, tenant fees of £209 and a refundable holding deposit of £296.
According to Goodlord, tenants in London needed the highest amount upfront per property at £4,347, whereas areas outside of London required tenants to pay on average £2,324.
Next year, tenants will no longer be required to pay the average £209 in fees for any administration tasks letting agents carry out to facilitate their move as part of the proposed bill. But tenants will still face normal annual rent increases of approximately 1.7%, meaning the average rent will likely increase to £1,111 per month.
If the Bill is passed, the average maximum security deposit could be £1,534 and refundable holding deposit £256.
This means the total potential amount of money a tenant would need to move home in 2019 would be £2,942 - only £97 less than in 2018.
Based on the research, Goodlord found London tenants could save the most - an average of £183 per property while tenants in the north of the country could pay an extra £100.
But given that many letting agents plan to recover lost income from tenant fees, most probably in the form of higher rents to cover these losses, Goodlord warns that any savings from the bill could be negated, especially in the less affluent areas of the country.
Goodlord COO Tom Mundy said: “Our industry needs regulation that doesn’t penalise good letting agents, promotes sustainable rents for tenants and gives landlords peace of mind.
“Current government legislation is making it harder for this to be the case and in some cases the proposed tenant fee ban is making it even more costly for the people it’s trying to protect.”