There has been a sharp rise in the number of tenants experiencing rent rises following the introduction of the tenant fees ban, new data shows.
The average number of tenants experiencing rent hikes year-on-year for the month of June rose to the highest figure on record in June, according to ARLA Propertymark’s latest PRS report.
The trade body for letting agents reports that more than half - 55% - of its members witnessed landlords increasing rents in June
This is a 22% increase from May which was a previous record high.
Year-on-year, the number of tenants facing rent increases is up from 35% in June last year and 35% in the corresponding month a year earlier, fuelled in part by a widening supply-demand imbalance in the market.
Letting agents had an average of 199 properties under management per member branch in June, down from 201 in May.
The marginal decline may be due partly to the fact that the number of landlords exiting the market in June remained at four per branch. This stood at the same figure in June 2018.
Meanwhile, demand from prospective tenants increased marginally in June, with the number of house hunters registered per branch rising to 70 on average, compared to 69 in May.
David Cox, ARLA Propertymark chief executive, commented: “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 onto 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.”