Letting agents expect rents to rise next year

 
Helen Cahill
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Letting agents will no longer be able to make tenants pay fees (Source: Getty)

Eight in ten letting agents think rents will rise next year as a result of chancellor Philip Hammond's decision to ban letting agents' fees for tenants, according to the Association of Residential Letting Agents (ARLA).

Hammond's announcement - which was a part of his Autumn Statement at the end of November - has angered both letting agents and landlords, who will now have to pick up the bill.

Many in the property industry have responded to the ban by saying that it will increase rents. However, analysis from Shelter has found that when such fees were banned in Scotland, only two per cent of landlords pushed up rents as a result.

David Cox, managing director of ARLA, said: "The number of rent hikes reported by letting agents continued to decrease in November, and it's a shame the ban on letting agent fees will have the opposite impact on rent prices when the measure comes into force."

Read more: Opinion: Forget fee bans – it's time to regulate letting agents

Landlords have also been angered by a scrap in mortgage interest relief and a stamp duty increase on second homes that came into effect in April this year.

The stamp duty hike pushed landlords to complete on property purchases in March, leading to a wave of new buy to let properties coming onto the market. This, combined with a decrease in demand from prospective tenants in November, resulted in falling rents.

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