The number of new rental properties coming onto the market in the UK will fall next year, as a result of the increased stamp duty surcharge on additional properties, it is claimed.
According to the predictions for the coming year from the Association of Residential Letting Agents (ARLA) some 37% of members envisage supply falling in 2017.
Over half, some 52% of member agents expect rent prices to increase in 2017 as lower stock levels, combined with mortgage interest relief and the ban on letting agent fees will put upward pressure on rents.
At the same time they expect demand for rental properties to rise and with less stock available for prospective tenants, competition will be high in 2017.
Also, they are predicting that due to the rise in landlord taxes in 2016, landlords may be forced to sell some or all of their buy to let properties and exit the market. Also, for prospective new investors, it will be more difficult obtain buy to let funding in 2017 as lenders introduce tougher criteria.
‘Our private rented sector report findings over the past few months have been positive and we were confident approaching the end of the year,’ said David Cox, ARLA managing director.
‘However, following the announcement of an outright ban on letting agent fees during the Chancellor’s Autumn Statement, we expect rent prices to rise and tenants to be forced to look for properties in cheaper areas,’ he explained.
The Government continues to lash out against the private rented sector to cover its own failure to build the number of homes this country needs. Such policies will have a detrimental effect on the very people the Government aims to help the most. As a result, we predict 2017 will be a raw year for renters. We now need stabilisation from the government before tenants are squeezed dry of every penny,’ he added.