Photograph by Anna Kunst
Guest blog by Tannaz Bhoot
John D Wood & Co has a lettings section as well as a sales department, and this year we have found a lot more people wanting to rent. Despite the continuing uncertainty regarding Brexit, we have had a record year for businesses relocating their staff to London, and a surge in a new type of renter – prospective buyers and sellers. In a market where buyers have not found their dream home, get sudden cold feet about a long-term commitment, or just financial nerves, renting became a flexible and less committed option. Vendors who were fortunate to secure a good sale have also joined the army of renters, as they in turn became buyers and the option of renting became an attractive safety net.
Not enough rental property
As is often the case, a rise in demand has created a shortage in supply, and towards the latter part of the year we began to find there was a decline in available property. Chiswick has not suffered from this as much as other parts of the capital, but there has been a drop in the number of properties coming on to the market. This may be that current tenants who started out as buyers have decided to extend and stay on as tenants. The risk of moving, but not finding a suitable option to buy, has meant many people have renewed for a further term. In Chiswick we achieved some strong rents for our landlords and were able to also avoid any prolonged periods without tenants.
Tenant Fee Ban
The Tenant Fee Ban came into force in June this year. The new legislation stopped the practice of tenants having to pay letting fees to agents in the private rented sector, and it also introduced a cap on tenancy deposits. What impact would this have on ourselves and our clients? It took a great deal of planning and preparation to ensure we were legally compliant. The general feeling has been that the law has further protected tenants and has required us agents to be even more on knowledgeable in order to be able to advise both landlords and tenants in the right way, as both prospective tenants and landlords are asking us more questions.
Zero Deposits came to the market, a change many of us are still getting used to. Prospective tenants can now rent a home without having to pay a hefty security deposit. Instead, you pay a non-refundable fee equating to one week’s rent, to an independent company. We’ve found that this has been helpful to first-time renters, many of whom have found that they could buy something important for their new home with the money they would have had to pay as a deposit, such as the sofa they really wanted.
It is a major change to how we have traditionally worked in lettings and is yet to be tried and tested. We will see this next year when tenancies come to an end. with zero deposits will put the Zero Deposits companies to the test. We predict that rents may increase into the New Year as demand is unlikely to reduce; whether supply meets the demand is a question we are all asking. 2019 was a year of a lot of change in the industry and we will see the effects into 2020.
Tannaz Bhoot is the Head of Lettings for John D Wood & Co
John D Wood & Co sponsors The Chiswick Calendar