Letting Fees Ban Spells Savings for Renters

A consultation paper about banning property letting fees has been released by the Department for Communities and Local Government (LCLG) and could spell savings for those looking to rent.

Over the past ten years the private rental sector has almost doubled and along with that has come unscrupulous behaviour from landlords and hidden costs from some letting agents and is these costs that the LCLG hopes to tackle.

The paper comes hand in hand with new measures that will mean landlords who do not adhere to regulations can be fined up to £30,000. The combined effect of the new legislation will help people wanting to rent a property to get a better deal.

Gavin Barwell, Minister for Housing and Planning said “These measures will give councils the additional powers they need to tackle poor-quality rental homes in their area. By driving out of business those rogue landlords that continue to flout the rules, we can raise standards, improve affordability and give tenants the protections they need.”

In Scotland, similar legislation was clarified in 2011 and has made for a fairer and more transparent letting system.

Many property agents, such as LCP properties have welcomed the initiative as it will level the playing field in both the private and commercial property sectors.

The idea for the legislation was conceived as part of Ed Miliband’s 2015 election manifesto and is still being championed by Labour MPs including Melanie Onn who said, “The Labour Party have long backed a ban that would not penalise renters for moving home and prevent millions of households in the private rented sector from handing over hundreds of pounds in letting agent fees.”

Others, however are worried that the new measures may test some property companies.

Cleethorpes MP Martin Vickers is looking to the government to re-examine the legislation, saying, “I think it has the potential to drive letting agents out of the market and further complicate the issue of getting rental accommodation. That plays a big part in the Cleethorpes constituency – there is a huge private rented sector in North East Lincolnshire. All this is likely to do is penalise tenants in the rented sector.”

Despite the reservations from some companies and individuals the ban on letting fees looks like it will soon become law soon. Rental agents who aren’t already set up to cope with the changes will have to adapt quickly or run the risk of losing their business.

Renters on the other hand can look forward to better property standards and a more transparent system.