Editor's note: This brief was summarised by The Property AI Team from a report by The Negotiator. Read the original article for full details.
Half of Letting Agents More Cautious About New Tenants Since Renters' Rights Act
More than half of letting agents are more cautious about which applicants they recommend than they were a year ago, according to Goodlord. A total of 51% say they have tightened up their recommendations since the Renters' Rights Act came into force.
More than a quarter of landlords, at 26%, say they are more likely to reject applicants they would have accepted before the Act. At the same time, 31% of landlords would rather leave a property empty while waiting for a lower-risk tenant.
Caution Tied to End of Section 21 and Rent Rules
Goodlord says the caution stems from the end of Section 21, the cap on rent in advance, and the ban on bidding above the asking rent.
William Reeve, chief executive of Goodlord, said the caution would hit certain groups hardest. He said: "The deep irony here is that certain tenants will now be far more likely to struggle to secure tenancies. This is creating a gulf between those settled in their properties and those seeking a new place to call home. Students, foreign nationals and those with non-traditional incomes are likely to fare the worst, becoming 'outsiders' in an increasingly cautious market."
Sentiment Splits by Agency Size and Tenant Group
Pessimism among agents has fallen from 48% to 40% in the past year. However, the size of an agency changes the picture, with optimism reaching 42% at companies with 11 or more staff, against 28% for those with five or less.
Tenant optimism has risen from 20% to 37%, with half of those aged 25 to 34 describing themselves as optimistic. Landlords remain the gloomiest group, with 69% pessimistic, down from 78% last year. Among landlords with six or more properties the figure rises to 81%, against 63% of those with a single property.
Reeve added: "This time last year, the industry was bracing itself for a seismic shift. Now that the initial dust is settled, you can almost hear the market exhaling. A gulf in sentiment is starting to emerge. Bigger agencies are feeling far more chipper compared to their smaller counterparts. And tenants and landlords are at opposite ends of the sentiment spectrum, which doesn't bode well when it comes to persuading landlords to stay in the market."
Source: The Negotiator