As many of you with an interest in the lettings market will have read over the past months, a major topic of conversation is the charging of fees to tenants by agents prior to moving into a new property.
We have had Bills in Parliament. We have had Online Petitions. We have got through 3 Housing ministers since this all began! Now we have a new Government working group looking at the issue…
This is the article from ‘Property Industry Eye’ on the latest thinktank solution:
The existence of a new body investigating costs for private tenants – including letting agent fees – has been revealed in the Commons by housing minister Gavin Harwell.
It is called the Private Rented Sector Affordability and Security Group, set up to explore ways to reduce costs for tenants. It meets under Chatham House rules.
The group has met once and is to have a second meeting shortly.
Barwell revealed its existence in a response to a petition presented by Labour MP Helen Hayes, urging the Government to cap letting agent fees.
In his response, Barwell said the Government believes that “ensuring full transparency is the best way… giving consumers the information they need so that they do not pay unfair fees, while supporting good letting agents”.
He went on: “The Government are committed to creating a bigger and better private rented sector, which is easily accessible to current and prospective tenants.
“We have set up the Private Rented Sector Affordability and Security working group which includes experts from across the PRS and housing sectors to explore options to reduce costs for tenants who access and move within the sector.
“The Government have also introduced a package of measures through the Housing and Planning Act 2016 to crackdown on unscrupulous landlords and property agents who exploit their tenants by renting out unsafe and substandard accommodation.
“This includes a database of rogue landlords and property agents, banning orders for the most prolific and serious offenders, civil penalties of up to £30,000, extended rent repayment orders and a more stringent ‘fit and proper’ person test for landlords applying for a licence.
“In addition the Government are determined to crack down on landlords who deliberately overcrowd their properties with vulnerable people and illegal migrants by extending mandatory licensing for houses in multiple occupation.”
As there always is when the topic once again becomes prominent in the press, the reactions have been somewhat mixed! The most common train of thought is that if agents are unable to charge tenants fees for applying for a tenancy – whether this be referencing fees, administration fees or application fees – these fees will then be bourne by the landlord and rents will increase to compensate thus having little effect on the tenants outgoings.
I will keep a close eye on developments regarding this issue and will update my readers if anything changes!