The perpetual targeting of the buy-to-let sector may have started to hit agency books after rental supply dropped by a third in London last month, lettings agents report.

The latest ARLA Propertymark private rented sector report shows the number of properties managed per member branch in the capital fell by a third from 148 in March to 101 in April, suggesting some truth in the warnings that the extra Stamp Duty costs as well as the end of mortgage interest relief would lead landlords to sell up or cut costs by self managing.

However, the number of properties managed per member branch across the rest of the country increased marginally, with agents managing 185 on average, up from 183 in March

Fewer tenants were also negotiating rent reductions, falling from 3.6% in March to 2.8% last year, while 24% of agents saw landlords increasing rents, down one percentage point.

The number of landlords selling up also remained flat at on average four per branch.

David Cox, chief executive of ARLA Propertymark, seemed to think the London drop was more due to the snap General Election.

He said: “Although the rental market in London has seen a large drop in the supply of properties available to rent, it’s a different picture in the rest of the UK where we have seen little or no change to activity since March.

“It’s likely we’re seeing the rest of the rental market outside of the capital plateau as a result of the election in June, with renters potentially holding back on their property searches until after June 8.

“It’s important that housing is at the top of the new Government’s agenda, as we have had two elections and a referendum in the last three years which is stalling the policy process meaning that we do not have the right houses available to provide the homes people need.”