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Letting agents whose incomes are boosted by high rents have been blamed for fuel costs that “make life difficult for tenants”.
Rents on new tenancies in the UK rose 12 per cent in December, according to Zooplan, with the rate of inflation hovering around 9 per cent.
In London, average rents have risen by 17 per cent in a year, adding to the pressure on tenants who are also struggling with steep increases in food, energy and fuel costs.
Generation Rent and the London Renters’ Union, groups that represent tenants, suggest that the extreme market conditions are being driven by landlords and their letting agents.
According to a survey of more than 1,000 tenants in England conducted by Generation Rent, when tenants facing a rent increase asked their landlords for an explanation, 17 percent cited the agent’s advice as the reason for the rent increase.
In comparison, 11 percent of landlords cited mortgage costs as the reason for increasing rents.
The survey found that a third of potential tenants were asked to attend a collective viewing with other tenants, a quarter were asked for several months’ rent in advance and a fifth were asked to increase the rent to secure a home.
Dan Wilson Crowe, deputy director of Generation Rent, said rising rents are a symptom of a market where homes are in short supply, but letting agents are making life harder for renters, with competitive bidding processes and conglomerations making the whole process more stressful. views
The agents denied claims that their conduct had distorted the market.
“Prices are going up because of competition from tenants and competing offers,” said Greg Tsuman, director of lettings at estate agent Martin Garrard and president-elect of trade body the Association of Residential Letting Agents.
Guy Gittins, chief executive of estate agents Foxton, said: “People want to see these properties. If everyone fights for property, it’s stressful. Guess what, it’s stressful for the agent as well, it’s not an environment we welcome.”
“We sympathize with London tenants; It’s a supply and demand dynamic that’s not healthy,” Gittins said, adding that Foxton’s registers 18,000 tenants per week during the peak summer months.
Rising rental demand has been a boon for agents – Foxton’s revenue from its lettings business rose 18 per cent year-on-year in the third quarter.
Instead of raising prices, Tsuman claimed that rental agents often advised landlords to go for lower prices because they would be more sustainable in the long run.
According to Wilson Crowe, high tenant turnover can be in the interest of hiring agents, who often charge landlords extra to find new tenants.
Michael Dees, co-ordinator of the London Renters’ Union, said: “Rents are not just going up – they are . . . Agents and market reports they release.”
The LRU said one of its members was evicted over Christmas after his landlord raised the rent by around 10 per cent.
“When we talked together [the managing agent] They revealed that they were only prioritizing potential tenants who could pay a year’s rent in advance – which for our property was £21,000. We felt absolutely inhumane. We lose our house during the holidays,” said the tenant.
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