Economy

Letting fee ban laws unveiled by Government

Letting fee ban laws unveiled by Government”

If a person has already breached the ban within the last five years, they will either be convicted under criminal law or fined up to £30,000.

A draft bill that could see letting fees banned and significant fines handed out to agencies that impose extra costs on tenants has been introduced to parliament today. "The rental sector can be a minefield of unforeseen costs and a ban on letting fees should make the whole process a lot more transparent and consumer friendly".

The draft Tenants Fees Bill can be found on the Department for Communities and Local Government website.

This latest action aims to help improve transparency, affordability and competition in the private rental market.

Communities Secretary Sajid Javid said:"Tenants should no longer be hit by surprise fees they may struggle to afford and should only be required to pay their rent alongside a refundable deposit".

It will also lay out proposed requirements on landlords and agents to return a holding deposit to a tenant.

Require Trading Standards to enforce the ban and to make provision for tenants to be able to recover unlawfully charged fees.

The Bill will introduce an enforcement authority in the lettings sector and will ensure that tenancy deposits are capped at six weeks' rent and that a holding deposit can not be for more than one week's rent.

'This new law must also be enforced so letting agents don't abuse the system'.

The draw bill also sets a cap on holding deposits at six weeks' rent.

John Midgley, chair of SAFEagent - a campaign set up to secure mandatory client money protection: issued a statement saying: "This consultation is a first vital step in achieving that goal".

Founder and chief executive of eMoov.co.uk Russell Quirk said: "The introduction of this bill brings us a step closer to levelling the playing field between letting agent and tenant and one that is certainly a step in the right direction".

But while renters will no doubt welcome the proposals, concerns have been expressed that agents will respond by passing on the costs to landlords, leaving them with no choice but to raise rents.

"Were delivering on our promise to ban letting agent fees, alongside other measures to make renting fairer and increase protection for renters".

In the forward to the draft bill he also says: "Whether you've been forced into life as a tenant or simply decided that it's the best option for you, you deserve to know that you will be treated fairly and not ripped off by the people you rely on for finding and renting your home".

"There is, of course, a danger that these agents will now try and recoup their losses through alternative means such charging higher fees to the landlord themselves".

"Since the plans were announced we have been lobbying the government and we met with the Minister of State for Housing and Planning, Alok Sharma MP, in September in order to press him to rethink his plans for a cap; taking into account the needs of those living and working in the private rented sector" says Chris Norris, head of policy at the NLA.



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