Letting agency fees to be banned for renters
Letting agencies will no longer be allowed to charge fees to renters, as Phillip Hammond will announce a complete ban in his Autumn Statement later today.
You might remember that a few months ago we reported that the Lib Dems were pushing for letting agency fees to banned from imposing ridiculous charges on tenants.
Well, it seems their efforts weren’t in vein, as Chancellor Phillip Hammond will be announcing a complete ban on agency fees for renters later today – rejoice!
Will this change affect how much rent I pay?
This news couldn't have come at a better time for students, as a report recently revealed that a housing shortage in university areas was driving rent up as much as 11% this year alone.
The agency fee ban is likely to really shake up the rental market as, unlike tenants who have no choice but to pay the (often ridiculous) fees in order to secure a house, landlords can shop around to get the best deal, meaning letting agencies will be forced to make prices fairer in order to attract business.
As to be expected, agencies have hit out saying this will have a negative effect on the rental market, claiming landlords will just raise rents to cover the additional costs they have to foot.
However, Scotland already imposed the ban in 2012 and the results were only positive.
In a report by Shelter Scotland following the ban four years ago, they found that rent increases were “small and short-lived” and that landlords were no more likely to raise rents than elsewhere in the UK, where agencies were still charging fees.
Have I been getting ripped off?
According to the latest English Housing Survey, renters pay anything between £223-500 in agency fees when securing a property.
And this doesn't just include the typical charges for admin, registration, inventory checks, reference checks, tenancy renewals and exit fees, but agencies have also been known to charge tenants for things like photocopying and ‘check-out’ charges.
A site called Urban.co.uk recently revealed that some agencies have been exposed for charging…
- £7.50 to pick up your keys from them (not to get them cut, but just pick them up)
- Mandatory £5 fee to photocopy the tenancy agreement
- £40 fee for unmarried couples moving in together
- £90 extra to move in on a Sunday!
It’s thought that the agency fee ban will save 4.3 million households hundreds of pounds. Rejoice!