A widening supply/demand imbalance in the buy-to-let market and the introduction of the Tenant Fees Act in June have been blamed for a record rise in rent in July.
Letting agent body ARLA Propertymark’s latest PRS reports that 63% of its members saw landlords increasing rents last month.
Year-on-year, the number of tenants facing rent increases is up from 31% in July in 2018 and from 55% in June.
Meanwhile, letting agents were reporting fewer properties on their books, with an average of 184 properties under management per member branch in July, down from 199 in June.
Demand from house hunters also increased in July, with the number of prospective tenants registered on average per branch rising to 73, compared to 70 in June.
However, year-on-year, demand has fallen, from 79 house hunters registered per branch in July 2018.
David Cox, ARLA Propertymark chief executive, said: “Following the Tenant Fees Act coming into force in June, rents have continued to rise, which we believed would happen.
“The fees agents have been banned from charging are still being paid for by tenants, however, it’s now through their rent, rather than upfront costs.
“The fall in the number of properties available further increases competition in the market, which only pushes rents up or forces landlords to exit the market entirely.
“As the sector faces increased levels of legislation, it’s evident this is putting even more pressure on the industry.”