Ban on Tenants fees is good news for 5 million private renters.

“The new Tenant’s Fees Bill is a huge leap forward for the lettings market – “An industry that has been double dipping and making profits from both tenants and landlords simultaneously for too long,” said Calum Brannan, chief executive of No Agent.

“With approximately five million households privately renting, a quarter of these being families with children, it’s clear the benefits of this Bill could be felt by a lot of people.”

Sam Hurst, at online letting agent OpenRent added: “It’s fantastic to finally have a date in the calendar for these important new protections for tenants.

“While OpenRent has never charged admin or agency fees to tenants, we’re very pleased to see that protection from inflated fees will now be extended to all tenants.

“OpenRent has proved that charging ripoff fees to tenants doesn’t have to be part of the business model of a successful letting agency.

“Renting in the UK has needed reform for decades, and we hope that the Tenant Fees Act will trigger a wave of modernisation and an end to outdated and frustrating practices that have cost landlords and tenants so much money for so long.”

Tenants Fees Act to come into force in June 2019.

The Government has announced that the Tenant Fees Act will come into force on the 1st of June 2019 after the House of Lords voted to approve the bill on Tuesday.

The bill will receive royal assent in the next few weeks – and will be introduced later in the year.

The announcement was made by Lord Bourne of Aberystwyth, the Government’s housing spokesperson in the House of Lords, during the Bill’s Third Reading.

“It has been clear throughout that this is a Bill that will introduce important changes for the private rented sector,” he said.

“It is in all our interest to introduce this introduction as soon as possible”.

“Implementation is subject to the parliamentary timetables and amendments need to be considered in the other place” (the House of Commons.)

“We need to enable agents and landlords following Royal Assent to become compliant but we intend for the provisions to come into force on June 1st, 2019.

“This would mean the ban on lettings fees would apply to all tenancies signed after this date.”

So, just what is being banned?

According to Government statistics, tenants are currently being charged £337 in fees on average for tasks related to cleaning services, name changes and credit checks.

That would stop.

Banning letting agent fees will improve transparency for renters, as currently fees are not explained clearly and tenants can be charged very different and sometimes very high amounts for similar services, according to the Government.

The act will ban all but a small amount of exempted costs as a condition of the ‘grant, continuance, assignment, termination or renewal’ of an assured shorthold tenancy or licence agreement.

Fees that will be scrapped include credit checks, inventories, cleaning services, referencing, administration charges and gardening.

Lord Bourne also put forward an amendment that would let enforcement authorities set a date for when interest could be paid from holding deposits that had not been returned in a required period.

Baroness Grender posted an article in December 2018. 

 “The sooner the Tenant Fees Bill becomes law, the sooner renters get a fairer deal”

“In the next few weeks, a Bill which slashes admin fees for tenants should clear Parliament and become law.”

“A small silver lining to this terrible Brexit storm is that the Conservative Government, knowing that any changes to the Bill must go through the turbulent House of Commons, have agreed to many of the amendments the Liberal Democrats have been pushing for in the Lords.”

“This Bill is a Tory manifesto commitment and therefore they wanted to avoid potentially jeopardising their Tenant Fees Bill entirely.  So, this is why at such a late stage they have agreed to remove major loopholes which the worst lettings agencies and landlords could have exploited.”

“It has been a long journey to get to this point.  When I first proposed this change in 2016 through a Private Member’s Bill, it was a flat “no” from the Conservative Government.  However, they could not keep ignoring the overwhelming evidence that people on low incomes or benefits who were renting privately were being ripped off with shocking admin fees.”

“The worst part is that families who are evicted or cannot afford a rent rise are pushed into homelessness by the astronomical up-front admin fees.”

“The option to move is not feasible, as even when they try to move to a cheaper home, agents were charging both landlord and tenant these up-front fees. With homelessness continuing to rise, and the leading cause being the end of a private rented sector tenancy, it is clear reform is needed – and fast. This is why this Bill is so vitally important. The double dip with both landlord and tenant being charged these extortionate fees will soon be a thing of the past and this change in the law cannot come soon enough.”

“Often the argument from the industry was that this was an unworkable model but there are many lettings agencies who have already banned admin fees and got ahead of the law.  Their success suggests that it is possible to scrap fees and run a sustainable letting agency.  After all, it is the landlords who are the customer, who can shop around and find the best deal, not the tenant who is desperate to find somewhere decent to live, near work and schools with a decent landlord.”

“There will also be other fundamental changes brought in by this Bill.  Deposit for rent is now 5 weeks instead of 6 a significant difference of on average £150 – peanuts to your renting Russian Oligarch, but the difference between food on the plates or nothing for those on low incomes.”

“One thing I was keen to amend the bill on, which the Government accepted, was the need for greater levels of transparency when a holding deposit is not returned.  People deserve to know what went wrong and in writing or they will keep putting down deposits with no explanation as to why their tenancy has been rejected.”

“With nearly a quarter of households now renting in the UK, there is still a long list of changes needed to ensure renters get fair treatment.” 

“An open register of landlords, particularly rogue landlords is now crucial, but we must not stop there.  If every place you eat can get a hygiene rating from your local authority, why not the same open and accessible system for where you live?  Reform is also desperately needed in how credit is assessed.  If you rent, your credit rating is much worse than if you have a mortgage, even if you have always paid in full and on time.  Legislation against revenge evictions equally needs to be tightened and will continue to be a threat whilst contracts are so short – 6 or 12 months.  We should study Scotland’s change to open-ended contracts a year ago and make changes there too.”

“Now that this Bill has been made much better in the Lords it must go through final stages as quickly as possible.  The sooner it becomes law, the sooner renters get a fairer deal.  Something to look forward to in 2019 – thank goodness!”

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