Almost half of letting agents have witnessed uncertainty from landlords looking to let properties, which ‘could cause waves in the rental market over the coming months’, warns the Association of Residential Letting Agents (ARLA).
The trade body reports that the private rented market has so far been unaffected by the UK’s decision to leave the EU, but it is urging the government to offer landlords reassurances that housing in the private rented sector (PRS) remains a priority or risk seeing many buy-to-let investors exit the market.
David Cox, managing director, ARLA, said: “The rental market has responded to Brexit in a calm fashion, with no immediate fallout amid extreme political and economic uncertainty. What we need is some certainty from the new government that housing remains a priority with the rental market playing a central role. For example, we want to avoid a situation where institutional investors start pulling away from the market because ultimately this will impact tenants by squeezing supply further and pushing up rents.
“Although we’ve seen some hesitation from landlords this is relatively mild and it’s important they do not act in haste. Any inevitable longer term changes will then be taken on board with greater ease.”
The PRS is in desperate need of more housing stock to help cater for growing demand from renters, which increased by 12% in June to 37 prospective tenants on average registered per ARLA member branch, up from 33 in May. The supply of rental properties rose by just 3% in June, from 171 in May to 176 properties on agents’ books.
The rental market remained stable last month, with little to no movement in terms of rental costs, but ARLA warn that will soon change unless more homes are made available.
Cox added: “If one thing is clear following Brexit, it’s that supply and demand remains a real issue in the rental market. If supply continues to dwindle against growing demand, no matter what the eventual implications of Brexit are, renting will become more difficult and expensive for tenants.”