Most landlords ‘will continue to use agents despite tenant fees ban’

 
Most landlords ‘will continue to use agents despite tenant fees ban’ [Image: Flamingo_Photography via iStock]

New research has shown that the majority of landlords who currently use letting agents will continue to do so if their premiums rise after the ban on tenant fees is introduced.

According to the UK Association of Letting Agents (UKALA), 71 per cent of landlords said they intend to stay with their agents.

This is despite the research showing that 79 per cent think their letting agents will increase their fees as a result of the proposed banning of charges to tenants, which was announced in the chancellor’s Autumn Statement last year.

The UKALA survey found that just nine per cent of landlords reported that they will stop working with their agent if their premiums rise.

Philip Hammond’s ban has come under criticism by those who say that making the private rented sector more affordable cannot be done by preventing agents from charging for their services, and that costs will eventually be passed on to tenants in the long term.

The new research found that 40 per cent of landlords said they would increase rents to cover the cost following an increase to agent fees, while 22 per cent said they would shop around for a better deal.

A further 13 per cent said they would attempt to negotiate or refuse to pay, while nine per cent would pay the additional fees.

Richard Price, executive director of UKALA, said the research was reassuring for agents, adding: “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.

“It leaves a tricky path ahead to navigate for agents as they’ll need to balance out the need to cover their costs in the wake of a ban on tenant fees without alienating their primary customers and source of income.”