Government Opens Up New Scheme To ‘Protect Renters And Landlords’

Housing Minister Heather Wheeler MP has brought forward new legislation to strengthen protections for money held by property agents. Under the new regulations taking effect from 1 April, all property agents in the private rented sector will be required to join a government-approved scheme to protect their clients’ money while it is in their possession – with fines of up to £30,000 if they fail to do so. In 2017, an estimated £2.7 bn in client funds – such as tenants’ deposits and landlords’ rental payments – was being held by letting agents. Read more on 24housing.

https://www.24housing.co.uk/news/government-opens-up-new-scheme-to-protect-renters-and-landlords/

Brokenshire Heralds New Law Protecting Tenants From Unfair Letting Fees

Tenants will be protected from unfair letting fees and will see their tenancy deposits capped at 5 weeks’ rent thanks to a new law.  Unexpected letting fees and high deposits can make properties harder for people to afford and are often not clearly explained upfront – leaving many prospective tenants unaware of the true costs of renting a property. The Tenant Fees Bill, which has received Royal Assent, puts an end to costly fees imposed by landlords or agents – with the ban on fees to come into effect from 1 June. It is expected to save tenants across England at least £240 million a year, or up to £70 per household. Read more on the MHCLG website.

https://www.gov.uk/government/news/james-brokenshire-heralds-new-law-protecting-tenants-from-unfair-letting-fees

The Cost Of Renting A Property Will Fall – But Not Until 2019

Everyone knows that saving for a deposit to get onto the property ladder is an insurmountable challenge for many, but private renters are also stung by having to fork out huge amounts of cash at the outset.  Would-be renters have a number of costs to take into account before they can think about getting the keys, including up to two months’ rent as a deposit, the first month’s rent in advance, as well as letting fees imposed by the agent. With UK rents now averaging around £1,196, according to research from Landbay, this means that some tenants could be forced to stump up as much as £3,588 in advance to secure the property, plus letting agency fees of an average £200-300 per tenant. Read more on the buyassociation website.

Letting Fee Ban ‘Will Not Cut The Cost Of Renting’

Government plans to ban letting agent fees paid by tenants are unlikely to make renting cheaper, as new research reveals the prospect of a ban is already being felt by the market. Among letting agents that responded to a survey by the Residential Landlords Association (RLA), over half, 57%, planned to cope with the proposed tenant fee ban by increasing the fees landlords pay. This raises the prospect of the extra costs being passed on to tenants in higher rents over the long-term. Read more on 24housing.

Tenants Let Down By Lack Of Letting Fee Enforcement

The government needs to do more to better enforce existing regulations designed to improve transparency around letting agent fees before looking to ban them outright. That’s the call being made by the Residential Landlords Association (RLA) as MPs debate plans to ban fees. Figures published earlier this year by the National Approved Letting Scheme found that after two years of the law coming into effect, 93% of councils had failed to issue a single financial penalty to a letting agent for breaching the law. Only three penalty notices had been served across England for failure to display all relevant landlord and tenant fees. Read more on the RLA website.

Lettings Fees To Be Banned

More than six months after first suggesting the idea, the government has announced plans to ban fees to lettings agents in England. A new Tenants' Fees Bill was announced in the Queen's Speech, which will stop tenants having to pay money to agents. The commitment was announced by the Conservatives in the 2016 Autumn Statement. ARLA Propertymark, which represents letting agents, said the new rules would cost 4,000 jobs. However the measure is likely to pass into law, as all the main parties had it in their election manifestos. Read more on the BBC website.

Agents Breaking Letting Fees Ban ‘Should Receive Robust Fines’

In response to the government’s consultation on banning letting agents’ fees to tenants, CIEH has strongly welcomed a complete ban on all letting agents fees. The organisation says it would remove some of the barriers tenants face in moving out of a poor quality home, while ensuring standards can improve in the private rented sector. CIEH represents environmental health professionals, the workforce that carries out inspections in the private rented sector, and has recommended fines of up to £30,000 for larger property managing agents would be in line with the civil penalty for committing a banning order offence. Read more on 24housing.

How Should A Ban On Letting Fees Work?

The CLG is consulting on how their proposed ban on letting agent fees should be implemented and enforced. Under the proposal, letting agents will no longer be able to charge fees to tenants for a variety of their services, including seeking references, inventory services and contract negotiations. The consultation document suggests that banning letting fees being charged to tenants will incentivise letting agents to compete for landlords’ business. This will lead to lower up-front costs paid by tenants, and greater clarity on the total costs of renting a new home. Read more on the Homeless Link website.

Industry Pours Scorn And Derision On Fees Ban Consultation

The government’s consultation on its proposed ban for fees levied on tenants by agents has been greeted with derision and contempt by a string of industry bodies. Isobel Thomson, chief executive of the National Approved Letting Scheme, described the proposed ban as “a misguided attempt to help tenants which will only serve to hit the most vulnerable and make their access to the private rented sector even less attainable.” Meanwhile the Residential Landlords Association issued a statement claiming that the last four housing ministers - including the current one, Gavin Barwell - had publicly opposed a fees ban. Read more n Letting Agent Today.

Banning Letting Agent Fees Paid By Tenants

The government announced at the 2016 Autumn Statement that it would consult on introducing a ban on letting agent fees paid by tenants, to improve competition in the private rental market and give renters greater clarity and control over what they will pay. This consultation paper invites views and comments on how the ban on letting agent fees paid by tenants in England should be implemented and enforced. Find details of the consultation on the CLG website.

Letting Fee Ban Will Hit Loyal Tenants Hardest

The Government’s proposed ban on letting agent fees will cost tenants who stay in properties the longest hundreds of pounds, ARLA in partnership with Capital Economics can reveal.

·         There are 4,000 jobs at risk if an outright ban is passed

·         The Exchequer is in receipt of £400m in employee taxes from letting agents

·         Some landlords expected to exit the market if they don’t inflate rents, adding to already high pressure on supply and demand in the rental sector

Read more on the ARLA website.

80% Of Letting Agents Expect Rents To Rise In 2017

Eight in ten letting agents expect rents to rise in 2017 according to the latest Private Rental Sector (PRS) report from the Association of Residential Letting Agents (ARLA). The report, which is the first since the Chancellor’s announcement to ban letting agent fees for tenants during his Autumn Statement, revealed that demand from prospective tenants fell again in November. The rental market continued to cool ahead of Christmas with 32 prospective tenants registered per letting agent branch, compared to 34 in October but 53% of agents expect to see a rise in demand next year. Read more on Housing Excellence.

Industry Bodies Respond To Ban On Letting Fees

Commenting on the Autumn Statement, Richard Lambert, Chief Executive Officer at the National Landlords Association (NLA), said: “The new Chancellor is clearly aware of the pressures facing those living in the private-rented sector, but in attempting to improve affordability he has shown that, like his predecessor, he lacks an understanding of how the whole sector works. There’s no doubt that some unscrupulous agents have got away with excessive fees and double-charging landlords and tenants for far too long.  Banning letting agent fees will be welcomed by private tenants, at least in the short-term, because they won’t realise that it will boomerang back on them. Agents will have no other option than to shift the fees on to landlords.” Read more on the NLA website.

Letting Agent Fees Ban Is Great News, But Will It Push Up Rents?

The forthcoming ban on letting fees is great news for England’s private renters. Renters have no real power to negotiate over fees and too many currently get stung with massive fees just to sign or renew a contract. This makes the impact of our unstable private rental market even worse. But since the ban was announced there have already been claims that costs will just get shunted back onto tenants through rent increases. This was also a hot topic when the legal clarification explicitly banning fees was going through in Scotland in 2012. Today some have claimed that there was abnormally high rent inflation in Scotland as a result of that change. Read more on the Shelter blog.

Don't Believe The Letting Agents: Banning Fees Is Good For Tenants

The government’s decision to ban letting fees to tenants is a victory for the country’s 11m renters, and common sense. It has also enabled the chancellor Philip Hammond to announce what is effectively a several-hundred-pound giveaway for “just about managing” households that, conveniently, doesn’t cost the government anything. One in three private renters move home each year, and upfront fees cost the typical two-adult household £400 when starting a tenancy. Tenants pick a property based on its rent and suitability: they have no say over which agent the landlord appoints to manage the tenancy. As a result agents have a captive market that they can charge whatever they like. This has resulted in fees for the same basic service ranging from £40 to nearly £800. Read more on the City Metric website.

Focus On The Power Of Government Is An Opportunity For Private Renters

In her conference keynote speech Theresa May reaffirmed her commitment to help struggling, working class people. Back in August, in her first speech as Prime Minister, she vowed to make Britain a “country that works for everyone” and putting “the power of government squarely at the service of ordinary working class people”.  A recent report by the Resolution Foundation suggested that a quarter of the households that the prime minister has in her sights are private renters. It also shows that of the ‘just managing’ the private renters are finding it most difficult to manage of all, because they’re struggling with the highest ongoing housing costs – as well as extra costs like letting fees. Read more on the Shelter blog.

Rent Fees Are A Step Closer To Being Scrapped

If you rent in England, Wales or Northern Ireland then you'll know all about those fees you have to pay when you sign a rental contract with a letting agent. Tenants can be charged anything from £25 up to £500 to check-in or check-out when moving. If you live in Scotland there are no fees because they've been scrapped. Now they are a step closer to being eliminated across the rest of the UK. Liberal Democrat Peer Baroness Olly Grender is proposing the government makes changes to the Renters' Rights Bill which includes scrapping fees. Read more on the BBC website.

Tenants Who Face Eviction Every Year

Private renters are living in constant fear of being evicted, with some households sent eviction notices every 10 months into a tenancy by landlords and letting agents keen to reduce their rights and impose extra fees and rent increases. Section 21 notices – which controversially allow landlords to evict a tenant without having to give a reason – are being sent to renters together with letters asking if they want to renew their term, leaving some feeling confused about their rights and unable to negotiate on rent rises or charges.  Some landlords issue Section 21 notices almost as soon as a tenancy is signed so that if there are problems later on they can act quickly. Read more on the Guardian website.

Letting Agents 'Will Have To Publish Their Fees in Full'

The government has said letting agents in England face a new obligation to display full details of their fees both on their websites and in their offices. At Deputy PM Nick Clegg's Commons question session, the Lib Dem leader faced calls from Labour's Harriet Harman to back her party's bid to ban agents from charging fees to tenants. He said there were "virtues" in the opposition's push for longer tenancies. But he warned that the fee ban could increase rents in the long run. Read more on the BBC website.

Labour’s Move to Ban Letting Agent Fees Defeated

Coalition MPs have defeated an amendment to the Consumer Rights Bill to ban letting agent fees, by a majority of 53 votes. The Labour proposal was defeated 281 to 228 with all but three Conservative and Lib Dem MPs voting against it. The government released its own amendment prior to the vote – letting agents will have to publish all fees charged in comprehensive detail or face fines. The CLG statement about the amendment said it will be added to the bill at a later date. Read more on Inside Housing.