The likely consequences of the tenant fees ban for agents has been highlighted by research from UKALA among landlords.
Carried out in partnership with the National Landlords Association among nearly 700 landlords, the research reveals that 71% of those who use a letting agent will continue to do so even if their costs rise following a tenant fees ban, although this also suggests that nearly a third of landlords will not.
Nearly 80% of landlords said they expect agent to increase their fees after a ban, while only 9% said they’d switch to self-managing their properties after it comes in.
UKALA says it is critical of the ban, and argues that “affordability in the private-rented sector cannot be addressed by preventing agents from charging for legitimate business services, and that the costs will eventually be passed on to tenants in the long-term,” it says.
The research also suggests that 40% of landlords are likely to increase rents to cover the additional costs, while just 9% are prepared to pay the extra costs themselves.
“UKALA agents strive to provide a premium service which represents excellent value for money, but the ban on tenant fees could leave hundreds of professional businesses with no other option than to increase fees for their landlord clients,” says Richard Price, Executive Director of UKALA (pictured).
“This research is reassuring for agents in some ways as it shows the majority of landlords will retain their services even if they have to pay more – which is testament to the essential role that agents play.
“However, one in ten landlords say they will turn their back on their agents if fees are passed on, and our previous research shows that a significant number will do the same if the impending tax changes take hold and erode their profits.”