Further turbulence in the Buy-to-let sector
Published: 01 December 2017
Paragon Bank’s latest Private Rented Sector Trends report shows there’s widespread concern amongst landlords that a ban on letting agents charging fees to tenants will result in an increase in fees charged to landlords.
Paragon’s third quarter report, based on interviews with over two hundred landlords, shows that almost three-quarters of landlords currently use a third party to let some or all of their property portfolio. However, almost a third of these have said that they would be discouraged from doing so if the landlords fees were to be increased. The most common reasons cited for engaging a third party are for credit checks, compiling an inventory, and seeking references.
John Heron, managing director of mortgages at Paragon is quoted as saying “In the midst of ongoing turbulence in the private rented sector, landlords have already had to navigate through challenging policy changes, and rethink their strategies accordingly.”
“An increase in landlord costs as a result of a ban on tenant fees would be the latest in a succession of challenges and it is unsurprising to learn that a substantial number of landlords might consider altering their approach to letting out their properties in that circumstance.”
Of the almost one third of landlords who let directly, the vast majority don’t charge any fees to their tenants.
The move to ban letting agents from charging tenants any fees was first mooted last November, but now, twelve months later, there’s still no date for when this new legislation will come into effect, adding further uncertainty to an already troubled sector. I hope you enjoyed the post. Be sure to visit ianriddle.com, or www.mortgagesexeter.co.uk your Exeter& Devon based Mortgage Broker, for more news.