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homeSunday 15th December 2019

Lettings fees ban expected by summer

Katie Coyne24/01/2019 - 14:00

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Fee ban could be in place by summer
Fee ban could be in place by summer

The Tenant Fees Bill, which bans agents and landlords from charging tenants lettings fees, is on the cusp of receiving royal assent and being passed into English law. 

The bill made its way through the Lord’s third reading in mid-January and yesterday passed amendments in the Commons.

During the reading, Lord Bourne of Aberystwyth said that, subject to the parliamentary timetable, the intention was for the bill to come into force on 1 June 2019

It will ban most upfront fees for tenants and cap security deposits at the equivalent of five weeks’ rent where the annual rent is less than £50,000, and six weeks if it is over that amount.

The idea is that tenants will be able to see the upfront the cost of a property in the advertised rent without hidden charges for administration, renewal and checks. These rules will also apply to online letting agents.

Default fees have been allowed for limited charges to recoup the costs of, for example, lost keys. However, some have argued it could provide a loophole for unscrupulous landlords to ‘try it on’ and introduce a catch-all default fee within the contract.

Agents and landlords will also be able to charge for a change or early termination of a tenancy requested by the tenant. They will also be able to charge for utilities, phone, broadband and TV, and council tax.

The bill also creates a civil offence with a fine of up to £5,000 for a first breach of the ban, rising to £30,000 for repeat offenders.  

Trading Standards, who will be responsible for policing the ban, have up until six months following a breach to take action. The act will also provide a means for tenants to recover illegally charged fees through the courts (via a First Tier Tribunal).

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