Data from Rightmove suggests that demand from tenants looking for a new home has soared seven per cent since the Tenants Fees Act has kicked in - and that’s seven times the normal increase seen at this time of year.
The figures could suggest people are looking to move earlier than usual, as the peak in demand usually comes in July. There will also be some who have been given a new impetus to move by the removal of most tenant fees, giving them a saving of hundreds of pounds in some cases.
In London the rise was even more acute - there was a 13 per cent increase in demand from May to June, compared to a four-year average of just four per cent at this time of year.
The portal says agents are reporting an increase in enquiries from tenants looking to move now that the majority of tenant fees have been removed.
Meanwhile nationally (excluding London) asking rents are at a record high of £817 per month, and running at 2.7 per cent up on a year ago as rents continue their steady annual rise, Rightmove reports.
The company’s commercial director and housing market analyst Miles Shipside says: “A spike in tenants looking for a new place to live indicates some unsurprisingly held out until fees to start a new tenancy were removed by the government at the start of June.
“The ongoing shortage of quality stock could end up being exacerbated further by landlords whose tenants are now giving their notice so they can move on without paying fees, and some of those landlords then choosing to sell up rather than let it out again.
“The rise in rental prices may also mean some agents or landlords have attempted to raise rents to help compensate for a loss of tenant fees. More build to rent developments with more premium offerings and rents could also be adding to the average increase.”
Rightmove also quotes two agents in support of its data.
Melanie Howarth, branch manager at Northwood in Doncaster, adds: “We’ve seen a massive increase in enquiries and we’re having to do everything differently now, such as arranging to meet lots of tenants at a property all at once. We’ve seen such an influx of interest, I’d say every property is seeing double, maybe triple, the levels of interest that it would have received prior to the tenant fee ban being introduced as it’s now cheaper for tenants to move around from property to property.”
And Richard Davies, head of lettings at Chestertons in London, says: “We’ve seen a 17 per cent increase in the number of tenants registering to view properties since the tenant fee ban came in on June 1 compared to the same time last year. Paying over asking price for rental properties in the peak summer lettings season is not too unusual in London, but we have noticed that tenants are more prepared to do so since the fee ban came in, potentially because they feel they are saving money on additional fees so can afford to spend a little more on their monthly rent to secure the right property.”
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Thanks to this horrible, damaging, totally ill-conceived pieced of shite, I mean of course the Tenant Fees Act 2019, we've already had half a dozen prospective tenants make offers on flats of ours they were only 1/2 interested in at best.... we (and our agents) then worked hard to get references and paid for credit checks etc only to find none of them responded to follow-up emails, answered their phones or bothered to explain themselves at all. This very rarely if ever happened to us before but now it's become normal....
....the reason? Well, it should be obvious! They don't have to pay for referencing or credit checks anymore so make offers on ALL the flats they've seen and then decide later if they are interested or can be bothered to ever speak to us (or our hard working and very nice agents) again.
They have no "stake" and nothing to lose.... everything is laid at their feet and they can do (or not do) as they please while WE must pay and endure all this....
and this is only the beginning.... we're expecting LOTS of normal, perfectly respectable tenants who have NEVER done anything wrong before to start defaulting on rent as and when word gets round that its the "smart" thing to do.... there are NO PENALTIES, NO COLLECTION COSTS, NO PROBLEMS AT ALL for them now.... its just 3% interest plus piffling base-rate (IF they feel like paying but even that's apparently unenforceable) and of course 3-and-a-bit% is a LOT less than say the 27% APR (or whatever) for their credit cards (that DO also still have the rights just taken from us to charge for debt collection costs on top) so when our tenants have "balances" (what we used to call debts) of, say, £750 or more then why not just pay it off and owe rent to the silly-old landlord instead? Makes sense and saves tenants a LOT of money and all that worry too - now nobody can chase or hassle them!
Thanks to the genius of a Tory government trying to look increasingly like a Labour government (and anyhow already fundamentally Blairite in character) we as Landlords have been FORCED to become ulta-low cost lenders with no ability to even enforce debts.
...and those are but two of the serious problems created for us by this piece of crap.
An absolute disgrace and I'm sure not something they wold have dared impose on any other industry sector or part of the economy.... can you imagine the government bringing in an exciting new law making it at least your RIGHT not to have to pay restaurant or car-hire or hotel or anything-else bills anymore and instead just have it on 3% (and a bit) credit for as long as you feel like, and actually not even have to pay the interest either unless and until you felt like it?
The government and/or people behind them (ultra-Remainer, "right on" Civil servants of course) really do appear to hate and/or envy and/or despise us (while blatantly trying to woo short-term "generation rent" votes at our grievous long term expense) and perhaps want to drive us out of business while at the same time trying via the back door and/or indirectly - now or in the near future - to take our properties/assets from us at blighted values.
It makes you want to give up, which as it happens is - I believe - EXACTLY what they hoped to achieve.
And the result is = higher rents to accommodate the owners increased costs for providing a product. "Simples"
The simplest solution to combat wrongun tenants is to only accept those that tenants that qualify for RGI.
This would be the only real defence remaining for LL.
Obviously that means vast swathes of the PRS would be untenable for many LL.
But such are the circumstances as you have alluded to it seems flight to quality is the only real defence against wrongun tenants.
A major retrenchment of the PRS needs to occur to ensure LL profitability.
Quality tenants should only be taken on by the PRS.
What happens to all those tenants who can't qualify for RGI will be of NO concern to LL.
Govt will have to sort out where millions of homeless tenants live.
I believe in light of little chance of appreciable CG in future it is a case of less is more.
So fewer properties in better areas with better client tenants.
Forget the pile them high business model.
That is now far too exposed to rent defaulting.
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