80% of ARLA agents foresee rent rises in 2017
By |Published On: 20th December 2016|

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80% of ARLA agents foresee rent rises in 2017

By |Published On: 20th December 2016|

This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.

UK rents are expected to increase during 2017, as a combination of a lack of housing supply and the raft of tax changes impacting on buy-to-let landlords.

The eventual phasing out of mortgage tax relief, alongside the introduction of more stringent buy-to-let mortgage lending conditions will also serve to push landlords away from the market.

A new poll from the Association of Residential Letting Agents (ARLA) has highlighted the possible adverse impact a ban on letting agent fees could have.

Rental Rises

After the Chancellor announced a ban on letting agent fees in this year’s Autumn Statement, 80% of ARLA agents believe that rents will rise in 2017. This is due to the assumption that the outright ban on letting agent fees to tenants will see these costs moved to landlords.

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.’[1]

‘The buy-to-let market is becoming less attractive for investors as the ban on fees, combined with the scrapping of mortgage interest relief and the stamp duty increase on second homes push costs up for landlords. So unfortunately, regardless of the uplift we saw in supply this month, we expect to see the number of properties available to rent fall next year,’ he continued.[1]

Fall in Letting Agents?

A number of buy-to-let landlords do not currently use letting agents to either find or manage properties and it has been mooted that many more should consider going solo moving forwards.

Gillian Kent, chairman at No Agent, said: ‘We’re firm believers that as landlords’ purse strings are tightened by tax changes and the expected increases from traditional letting agents that landlords will look for alternatives.’(1)

Simon Lambert, editor of This is Money, wrote on the website: ‘Landlords are always ripe for a kicking in some circles, so it should come as no surprise that they were swiftly painted as potential future villains in the ban on tenant fees.’[1]

80% of ARLA agents foresee rent rises in 2017

80% of ARLA agents foresee rent rises in 2017


Lambert also believes that buy-to-let investors are right to be as angry as tenants over fees charged by agents.

He observes: ‘Many (landlords) pay handsomely for letting and management already and the fees they pay are meant to cover many of the things that some unscrupulous letting agents also charge tenants for.’[1]

‘A check with their agent on the level of double-charging going on would leave a landlord as grumpy as their tenant,’ he added.[1]

Concluding, Mr Lambert observed that landlords no not profit from existing tenant fees. As a result, while agents will be wanting to keep their revenues, an attempt to get back lost earnings by putting extra costs onto landlords represents a, ‘high-risk strategy.’[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2016/12/vast-majority-of-letting-agents-expect-rents-to-rise-in-2017

About the Author: Em Morley (she/they)

Em is the Content Marketing Manager for Just Landlords, with over five years of experience writing for insurance and property websites. Together with the knowledge and expertise of the Just Landlords underwriting team, Em aims to provide those in the property industry with helpful resources. When she’s not at her computer researching and writing property and insurance guides, you’ll find her exploring the British countryside, searching for geocaches.

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