A Cardiff family-run estate agent says a surge in property rents in the private rented sector combined with a decrease in rental properties available was inevitable following the introduction of new legislation over recent years.
According to the Office for National Statistics, property rents in Wales have risen by 4.4% in the past year, the highest annual percentage change since 2010. Demand for properties now outweighs supply which is pushing prices even higher. Thomas H Wood, which has showrooms in Whitchurch and Radyr, says this situation has been forthcoming for some time.
John Wood, Director of Thomas H Wood, said: “We’ve warned of repercussions following new industry legislation, changes to landlord tax as well as mortgage rate increases.
“The Renting Homes (Wales) Act came into force in December and, while it was designed to help protect renters, the additional prohibitive requirements have increased the financial pressure on landlords to such a point that many have chosen to leave the market, which of course has reduced the rental stock available to let.
“Rent Smart Wales is another landlord obligation that requires additional training and licensing and has put off many landlords, particularly more traditional individuals.
“Taxes on letting income have increased and there are now less items that can be claimed back as tax deductive. Combined with mortgage rate increases and Welsh Government’s ban on charging tenants a fee, landlords are seeing less profit, which has to be made up.
“Many of these consequences were brought up in consultations between estate agents, landlords and the Welsh Government, so the situation we find ourselves in has not come as a surprise. Unfortunately, landlords have been pushed to a point where they have no choice but to increase rents to recoup additional costs imposed on them or the position is simply no longer viable, and they need to sell their rental stock.”
