With rents in the North West increasing at the highest rate for almost half a decade and more tenants than ever before, a Burnley estate agent has warned that the market is moving towards offering even less choice and higher costs for renters.
According to Petty Estate Agents, a new snapshop of the lettings market from Rightmove has show that outside of London, there has been a 10% fall in the number of rental properties marked as available compared to this time last year, while the North West has seen the UK's biggest increase in demand for tenancies.
According to Simon Westwell, Lettings Director at Petty Estate Agents, the drop in buy to let activity and increased demand from tenants coupled with the upcoming lettings fee ban has led to tenants being left short changed.
“We’ve seen on average an increase of 3% on rents due to lack of supply and the letting fee ban," said Simon. “Whilst I understand the logic behind the ban I don’t necessarily agree with it and a fairer system would have been a cap with fees. We now have to accept the decision and move on."
First introduced in 2016 and confirmed as coming into effect from June 1st of this year, the new Letting Fee ban legislation will mean that the only fees renters can be charged will be the rent, a refundable security deposit, a refundable holding deposit, and what will be known as ‘default fees’.
Currently, tenants are charged a fee for the work required in order to set up their tenancy agreement including credit checks, referencing, and inventories, and as these checks will still be required, Petty's claim it is likely to mean that agent’s fees to landlords will increase, with the costs then passed on to tenants in higher rents.
"We at Petty’s have started making plans when the letting fee ban comes into place but unfortunately some agents will cease to trade when the ban starts in June this year and only the best agents will survive," Simon said. "This will have a knock on effect and make things more difficult for tenants as well as landlords, further exacerbating the lack of supply.
"This year I can see demand far exceeding supply so further rent increases should be expected as the year progresses.”