A total tenant fee ban will cost the industry £200 million a year in turnover and 4,000 jobs according to research published today by The Association of Residential Letting Agents (ARLA).

The research also suggests that landlords will lose £300 million in income while tenants will pay an extra £103 a year in rent on average.

ARLA commissioned Capital Economics to look at the lettings industry, which it says turns over £4 billion a year and employs 58,000 people charging on average £206 per tenant or £412 for a pair of tenants.

£700 million a year

The research also reveals that tenant fees generate around £700 million a year for the industry or 20% of its turnover.

In what ARLA describes as the “damning, unintended consequences” of a ban, it will benefit those who move house often, but push up rents for those who must or choose to stay put for long periods.

“The letting fees ban favours those tenants who move more regularly, says ARLA Managing Director David Cox.

“This is because both short term tenants and long term tenants – who move less frequently – will see a rise in rent equivalent to £103 per year under our plausible outcome.

“However those that move more often will now save more compared to previously.”

Cox says this will hit lower-income families, who tend to move less often than more affluent tenants.

David also says that during the government consultation on the fees on the ban, which he says is due to start “imminently”, ARLA members and their colleagues must submit individual responses alongside “the collective ones submitted by ARLA Propertymark”, he says.