APRIL 29, 2016 | BY A & S Property
Supply of rental stock falls
The supply of rental housing stock on letting agents’ books fell in March, to the lowest level since the start of last year, according to the Association of Residential Letting Agents (ARLA) March Private Rental Sector (PRS) report.
In March, two thirds (65%) of ARLA agents predicted that current and prospective BTL landlords will walk away from the market following the April stamp duty changes, causing a decrease in the supply of rental properties. Rent costs rose in March for a third of tenants (32%), and three in five (61%) ARLA members fear they will increase further as a result of the changes – a growing sentiment since last month, when 57% of agents agreed on this.
“Not only do our agents predict that rent costs will increase further, but rental homes may also face a decline in quality over time, as landlords struggle to keep up with maintenance costs alongside the higher stamp duty charge. Whilst landlords adjust to the increase in costs we can expect to see one of three outcomes prevailing in the buy to let market: landlords absorbing the cost and taking the hit; landlords withdrawing from the market causing supply to fall; or landlords regaining those costs through hiking rents. Next month we can start to assess the damage.”
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