The Royal Institution of Chartered Surveyors (RICS) has warned that the UK authorities must “stop punitive measures” against the country’s landlords.
The comments come after a year when the private rented sector has been subject to a string of new policy announcements, from a stamp duty surcharge on buy-to-let purchases and the phasing out of mortgage interest tax relief, forcing smaller investors up a tax bracket, to, most recently, a ban on letting agent fees for tenants, which is expected to see costs passed on to landlords. As a result, many will have no option but to raise their rents. Many have already begun, according to some research.
In January, new rents in the UK rose 2.6 per cent year-on-year, according to the latest Countrywide index, with 36 per cent of landlords increasing rents when signing new tenancies, up from 27 per cent a year ago.
Over the next five years, the RICS now projects that rental projections point to a cumulative increase of just over 25 per cent, outpacing house price growth.
Jeremy Blackburn, RICS Head of UK Policy, welcomed the government’s increasing emphasis upon the build-to-rent sector as a means to boost supply in the long-term:
“They’ve listened to us on expanding supply not just pumping demand, and on giving institutionalised PRS much greater priority alongside owner occupation. Our survey demonstrates how vital greater supply is in this sector; we really need to turbo boost Build to Rent. The detail on the ban on letting agent fees is yet to come, and along with any overt forcing of longer tenancies, could dampen investment in buy-to-let overall. The government must be careful about signalling both stop and go at the same time.”
In good news for landlords, online UK student letting agency, StudentTenant.com, hit record lettings in January as students rushed to secure accommodation ahead of the next academic year.
The business saw strong a 75% rise in searches, with strong growth in property uploads, student property viewings and property bookings during the busiest time of year.
Property requests were five times more likely in January 2017, reinforcing the trend of students booking property almost nine months before they move in.
The record-breaking number of confirmed bookings and property lettings followed a surge of demand in properties as students rushed to secure housing for the next academic year.
Danielle Cullen, Managing Director at StudentTenant.com, says, “It’s been another brilliant month for us. We’re extremely happy with the performance of StudentTenant.com over the past year, especially in January, as our team have been working extremely hard to keep up with the surge in demand.
“Figures reveal that January is the busiest time of year for students searching for properties, so it’s extremely important for us to get landlords on our site before demand peaks.”