Agents have been warned to be on their guard for the letting fees ban to be attached to another Bill and brought forward.
The warning comes from ARLA managing director David Cox and follows Wednesday’s NALS conference where a civil servant said the ban was unlikely to be implemented until 2018 because of the need for primary legislation.
However, Cox said yesterday: “My expectation last week was that a ban on tenant fees would take 12-18 months to implement.
“This expectation has been confirmed by DCLG although there is no guarantee that legislation will not be added to an existing Bill which would bring the timetable forward.
“Agents have to start to make practical preparations now.”
He said that ARLA will now launch a lobbying campaign to ensure that legislators fully understand the implications of a ban.
Cox also said that it was unclear whether the ban would address up-front fees, or all fees.
Yesterday, said Cox, he attended a meeting at which DCLG was unable to answer the question or give any information as to what would be included in the ban.
Cox criticised the lack of information ahead of the consultation on what looks like a done deal on government policy which is due to be launched in the New Year, saying: “While I think it is unlikely that any further information will be made publicly available before the consultation opens, there are still too many unanswered questions and this is unacceptable.
“The proposed ban will have a drastic impact on many people and businesses, and to announce it without consultation or clarity is wrong.”
O.. welcome to the room Mr Cox!
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I assume that the government will shortly be banning bank & building society charges when setting up mortgages for clients!?!
this is totally ridiculous and the government should be looking at other far more important issues than trying to stop professional agents making a living and providing a high level of service for the landlords.
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Why should tenants pay for a high level of services to landlords? This is EXACTLY the problem, the industry expects tenants to subsidise fees to landlords and uses this to compete.
In general, the service I’ve received from letting agents (thrice big corporates) for hundreds of pounds of fees has been appalling. I’m glad I was paying for the landlord to receive a good service though.
The parallels are not the same with banks and building societies, because you can always choose a different bank or building society for your mortgage on a house.
Tenants have little or no choice if they want to rent a particular house to go with the agent.
Have fun passing it on to landlords. We’ll see if they want to pay for their own high service. I assume with all the bleating here you think this is unlikely.
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How did you like all the free viewings, telephone calls, advice, time spent with you?
You do have a choice, you can go with the landlord on gumtree or the local free paper – Oh wait you will not get a gas safety certificate, dodgy lease, poor inventory, deposit withheld.
So you want a professional agent to let through but not pay for it – Yep seems fair.
Also to be honest, (don’t care that this is controversial) most tenants are a complete pain in the backside! – You are all at some point difficult to deal with, you all have a chip on your shoulder. and look to complain without taking responsibility. Most think they live in a hotel not rent a house.
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helloo helloo hellooooooooo
https://hansard.parliament.uk/lords/2016-11-18/debates/DFF19B1B-3A2F-4A8D-B203-FB239457ADC8/Renters%E2%80%99RightsBill(HL)
I feel like I’m talking to myself!! 😀
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I m listening old boy
agree to an extent, although I cant imagine they would want to use a Lib Dem Bill (especially after the election result last night)
However, I think it will be quite quick and this year not next considering that they usual suspects are already demanding a immediate ban. It would not do the Gov any harm to push this through quickly to appease 95% of the public
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Given this is a vote winner I suspect it will be pushed through using the Renters Bill which is already making its way through Parliament, then at least the government can blame someone else if it goes wrong 😀
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I know one agent who has ditched fees already and a couple whereby the tenants are refusing to pay. Agents need to act, work out a number of different business models, so they can press “go” without too much dithering when he legislation is announced
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We’ve had a prospective tenant ask whilst booking a viewing if it is legal for us to charge them application fees.
Had another tell us, bluntly though not impolitely, that we were by far the most expensive agent in the area. Considering that we took a look at all the local agents’ websites recently and found most of them aren’t displaying anything like a full list of fees, I’m not sure what information these prospective tenants had to be able to make that call – and I can understand why it might seem to them that we are charging them an above and beyond amount when we are being transparent about what we charge and for what, when other agents aren’t!
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I assume that the government will shortly be banning bank & building society charges when setting up mortgages for clients!?!
this is totally ridiculous and the government should be looking at other far more important issues than trying to stop professional agents making a living and providing a high level of service for the landlords.
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There are two distinct scenarios here. The mechanism to ban fees already exists in the Renters Rights Bill which is yet to presented to the commons. Will it be discontinued in favour of new legislation which not only addresses tenant fees, but also includes a raft of other measures? Will the campaign for mandatory CMP be included? Frankly, we don’t know and at this stage it is wrong to speculate.
However, considering Mr Hammond’s surprise announcement which caught everyone off guard, David is absolutely right to urge caution. Businesses should be prepared and industry should pull together as it is with the Fair Fees Working Group.
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ARLA break silence and just in time. Whilst I appreciate we can’t expect ARLA to do everything for us. We need to know what to do next. Should we be at our MPs? signing petitions?
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What if the Landlord charges 1.5 months rent as a first month rent and the usual rent for the remainder months??? Wouldn’t that be able to cover agents fee and also be covered by law as its RENT not FEES . That half month rent can be given to the agent as the agency fee. Here I don’t understand if 10 different people walk in and are interested in a property. No one has to pay any fee. All fail the mandatory checks like credit checks and references. The agency will have spent many hours in sifting through it. The referencing only business will pop up. Tenants will have to pay them and get their credit checks and other references ready well in advance before applying. Why would your ex agency give you a reference if it had a policy of getting paid for a reference? So an additional expense is now what will have to be borne by tenants to get all the credit checks , guarantor letters & references etc ready before applying to rent.
The balanced approach would have been to cap certain fees and charge for some certain fees. There could have been a limit in terms of maybe rent percentage that a tenant could be charged sir a fixed fee beyond which no agent could have charged. Let’s say £100-125 per tenant. The tenant would be paying almost similar amounts to other referencing agencies now.
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Great minds this alike Ryan.
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Genius…. Never underestimate the entrepreneurial spark of an Estate Agent!
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Good luck on that one….
You can call it whatever you like, but if walks like a fee, looks like a fee, and smells like a fee, then the courts may find against you
street v mountford in terms of a licence, springs to mind
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I have to agree with Ding Dong, plus rent is VAT exempt, and if it is rent then the landlord is due it. So you’d then have to invoice your landlord for the extra “rent/fee/thingy” and there then is no guarantee you’d get it.
Or you charge the landlord essentially half of one months rent more on top of the current fees, then ask the tenant to pay 1.5 months rent at the first month, and the landlord keeps the true rent, less normal fees.
But by doing all that, rents have gone up, which is the common consensuses as to what will actually happen, and other agents will undercut that fee.
Don’t give up on the ideas yet, they’ll be a golden one in there somewhere.
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When I was renting I was never asked to pay agency fees. Have agents stopped charging landlords or do they now charge landlords and tenants? My friends daughter is about to rent a student flat, five girls each have to pay £250.00 fees to the agent. Damned good money if you ask me.
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Should only be one applicant paying a fee once a holding deposit is taken. Why would five individuals have to pay?
Regulation, overheads, processes have most likely increased since you last rented.
As some forget letting agents are businesses NOT charities.
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