David Cox, managing director for the Association of Residential Letting Agents (ARLA), reporting the figures, attributed the findings to the Chancellor’s Autumn Statement announcement of a 3% Stamp Duty Land Tax (SDLT) surcharge on buy-to-let properties and second homes, which will come into effect in April 2016.
“When the rabbit was first pulled out of the hat, we said these changes would be ‘catastrophic’ for the rental sector and this has been echoed by letting agents across the country.”
Cox said that the SDLT surcharge will make owning a buy-to-let unprofitable for a lot of landlords, and would make new investors think twice about purchasing such a property.”
Supply of rental properties increased by 9% between October and November, rising from 173 to 189 properties managed by letting agents.
However, tenants in London will face more difficulty finding a home with only 121 homes managed per branch, 36% less than the UK average.
Less than a quarter (23%) of letting agents reported rent increases for tenants in October, the lowest figure of the year.
This is a decrease of two percentage points compared to October.
“It’s promising to see that the number of agents reporting rent increases is continuing to decline, and this should spread some Christmas cheer amongst renters renewing tenancies or looking for a new property to rent. However, just under a quarter of tenants are still unfortunately seeing hikes in their monthly rent payments,” Cox said.
“But if we continue to follow trends we’ve seen in previous months, we should see fewer tenants experiencing increases as we welcome in 2016.”