The JLL lettings agency is warning that the five week deposit cap enshrined in the Tenant Fees Act is likely to prompt an increase in rent paid by tenants with pets.
JLL says there’s been a 25 per cent increase in tenants letting with pets in the last five years because of a general increase in cat and dog ownership, relaxed quarantine laws and a broader trend for longer tenancies.
But Lucy Morton, head of residential agency at JLL, warns: “Landlords who allow tenants to keep pets usually do so by charging a slightly higher deposit which would cover any damage or additional cleaning should it be required. With the five week deposit cap, landlords may be deterred from letting to tenants with pets or forced to charge higher rents to cover any potential losses.”
JLL says the increase would depend on the rental value, but it anticipates a rise of three to four per cent. It suggests that a London property with a rent of £700.00 per week could potentially rise to £725.00 per week to make up for the shortfall.
“With a host of regulations that landlords must adhere to, as well as the changes to mortgage interest relief, the fee ban and five week deposit cap is adding yet another cost. This gives landlords no choice but to increase rents in order to see a return on their investment and they will need to hold firm on asking or renewal prices” explains Morton.
“Whilst some agents were charging unnecessarily high fees to tenants, I do think the government should have capped fees rather than scrap them altogether or made allowances for landlords letting to tenants with pets.
“The government needs to be careful not to completely deter buy to let landlords – they are an essential part of the overall housing market, providing a home for those who choose to rent, and people with pets shouldn’t be made to lose out.”