Landlords and agencies face ban on extra charges to tenants

Coming into force on June 19, the new Government regulations will stop landlords and agencies charging for services such as referencing, inventories and cleaning on top of their deposit and advance rental payments

Landlords and letting agencies face a crackdown on extra fees from June

 

Residential landlords and letting agencies could face increased costs of tens of thousands of pounds amid tough new rules on extra charges for tenants.

Coming into force on June 19, the new Government regulations will stop landlords and agencies charging for services such as referencing, inventories and cleaning on top of their deposit and advance rental payments.

According to industry body ARLA, the average saving for a tenant will be £337, while the cost to an average agency could increase, costing them around £60,000 to February 2021.

And Gerry Mason-Rolls, lettings director at Warrington-based James Peacock Property, warns that a agencies and landlords that fail to comply with the law could fines fines of up to £30,000 per property.

Among the fees that landlords and agencies will no longer be able to charge for are charges for a guarantor form; credit checking; inventory checks; domestic cleaning; taking up references; professional cleaning; having the property cleaned of fleas as a condition of having a pet; administration costs; requirements to have specific insurance providers; gardening provisions.

Ms Mason-Rolls said: “While at first glance the change doesn’t look great for landlords and agencies, it is a positive step forward for the industry. We’ve had some time to plan and change our processes to meet it head on, without compromise.

“As a result, we think we’re actually able to offer a better service than we did before, without impacting too much on our clients”

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The news coincides with another announcement that all landlords must be registered with a redress scheme, so that tenants and homeowners have somewhere to turn in case of a dispute, with fines for non-non-compliance of up to £5000.

Initially the new law will apply to new tenancies or renewals, however it is expected that by June 2020 it will be extended to include pre-existing tenancy agreements.

There are a few charges which will be exempt from the ban, namely holding deposits, rent, deposits and charges related to contractural agreements.

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