The forthcoming ban on letting agent fees charged to tenants has been cited as “an important step” by the housing minister in the Commons.
During a debate on homelessness, MPs expressed concerns at the costs of rental deposits.
Housing minister Gavin Barwell – who called homelessness a “moral stain” – said the Government is attempting to “deal with the up-front cost of accessing the private rented sector”.
He went on: “In terms of dealing with statutory homelessness, access to the private rented sector is key. That is why the Chancellor’s announcement in the Autumn Statement about letting agent fees – I am sure the Opposition welcome that announcement – is an important step.”
In only September this year, he rejected the idea of a ban, calling it a bad idea: “Landlords would pass costs to tenants via rent. We’re looking at other ways to cut upfront costs and raise standards,” he said on September 19.
This week’s debate was moved by shadow secretary of state for housing John Healey, who was the last housing minister under Labour.
He said there was a record number of homeless people now sleeping rough, and that over 10,000 children will spend Christmas Day in temporary accommodation.
He said there was a lack of action to help private renters, “while eviction or default from a private tenancy is now the biggest single cause of homelessness”.
During the debate the private rented sector was repeatedly mentioned.
Conservative MP Will Quince (Colchester) said the private rented sector was part of the problem.
He said: “We know that the largest cause of homelessness is the ending of a tenancy, largely via a Section 21 notice.
“The system whereby an individual comes to their council for assistance at the earliest possible opportunity when they get into trouble, and the council turns them away and says, ‘Come back when the bailiffs are knocking on your door’ – at which point the person has arrears and a county court judgment against their name, and will never again be able to rent in the private rented sector – is failing those individuals, and it has to stop.”
Quince said that in the same way there are Help to Buy schemes, there should be a Help to Rent scheme.
Former shadow housing minister Jack Dromey spoke of a “rapidly growing private rented sector, characterised by soaring rents, with the average tenant paying £2,000 more over the past five years; insecurity; and often poor accommodation”.
Tory MP Bob Blackman called for a national scheme where prospective tenants could get deposits.
Andy Slaughter, shadow housing minister, said the Government had a “responsibility” to legislate for longer tenancies and rent controls.
The full debate is here
Comments (28)
Wouldn’t be so much a problem if the local councils didn’t insist on paying the DSS payments to the tenants who spend it instead of using it to pay rent……They should pay it directly to the Agents / Landlords in all cases and then they wouldn’t fall behind on their rent and get evicted !!!!
Also cuts down on admin, saves costs for the council having to sort out agent / landlord queries on rent etc ….not bright the leaders of these councils.
This is now becoming farcical. I have been biting my tongue for weeks and I have had enough now and I must put all this down. As previous commenters have said – how is a fee of around £200 to be blamed for making someone homeless. It is utter nonsense. And people don’t become homeless because they paid a referencing charge. Of course it is awful for people to be on the streets, but they might be homeless because they didn’t pay their mortgage and their home was re-possessed. There are so many reasons for this. Gavin Barwell is another crowd pleaser who hasn’t got the courage of his own convictions. Expressing concern about the cost of “rental deposits” – well let’s talk about that shall we? Deposits are NOT fees! For heaven’s sake – can someone please educate these people. If you are going to talk about something, get it right. Perhaps they should come and work in an agency to see how things are. They might then think again.
Are we supposed to allow tenants into a property without a safeguard for the poor beleaguered landlord. And let’s not forget about deposit legislation. The deposit is always the tenants money and cannot be regarded as anything else. There is a process to go through at the end of a tenancy to assess the amount (if any) for damage, cleaning etc. The tenant has a right to go to adjudication over this if he disagrees and adjudicators have the final say. Deposits are currently the only safeguard against unscrupulous tenants damaging a property and even this doesn’t work in some cases.
The landlord cannot be expected to just hand over the keys and hope for the best! Having worked in this industry for years and having to put up with endless changes in legislation to deal with along with your daily work, I could go on for days. The Government needs to listen to this industry and consult us. Instead, they come along with hysterical abandon chopping us all into little pieces with their big fat axes as they go. The Housing Act is there to protect tenants and it does. As another commentator says, councils advise tenants to stay in a property until they are evicted or they won’t help them. Who pays for the court costs? The landlord of course who also will have suffered a loss of rent along the way and is likely have a mortgage to pay. So – the tenant is living rent free throughout this process!
As one of the commenters above says – we don’t work for free. Employing people costs money. Oh what a surprise! Banning the right to earn money will cost people their jobs in the end apart from anything else! Then who picks up that tab? We are already reeling from the increase in stamp duty, the assault on landlords with their tax relief being cut..etc etc…They want to take away our right to earn and then hit us with an increase in the minimum wage, (my guys earn more than that anyway – but…), contributions to pension schemes and on it goes for employers, a relentless barrage of abuse. Politicians have to justify their existence – this is the problem we face. Please don’t get me wrong, I am all for banning rogue agents and landlords both, but we do it properly here. We don’t take on Landlords who think they are a law unto themselves, unlike other agents I could mention. We also ensure that the properties we let are safe to let and if a landlord doesn’t want to do it the right way, we won’t deal with them. Please give us some credit. It’s insulting to be lumped together with criminals. Punish them and leave the rest of us alone to get on with our jobs which are hard enough as it is.
Do buyers have to pay a lender fees when they apply for a mortgage? Yes. Do they have to pay solicitors fees on a purchase and sale? Yes. Do they have to pay a financial advisor fees? Yes. Processing applications, paying for comprehensive references,credit checks, right to rent checks (we are now the border police), know your customer checks to guard against fraudulent applications, dealing with problems that arise (there is always something), bad credit, queries, getting guarantors, the cost of printing, overheads etc, this all has a cost – in both monetary terms and time and a fairy doesn’t sit in your office for free for the sheer love of it. We have to train people, go on courses, pay for up to date tenancy agreements, pay for legal helplines and on and on. When the Government decides to wham us with another bit of legislation or the Property Ombudsman with their Code of Practice for that matter, we have to action it all – this takes time and costs money and who does that? The free fairies obviously.
There is no such thing as a free lunch and all this coming from a Conservative Government for heaven’s sake…What an outrage this is. We are all sick to the back teeth of it all and appeal for some common sense to prevail. I might stand for election! All votes gratefully received.
Trouble is I can never bring myself to vote for people who sit on the fence, passionless and don’t commit themselves.
and refuse to put forward a detailed comprehensive view.
Why not build a small apartment block in every town with a problem, with a communal kitchen and social area on the ground floor, together with a food bank (giving the fantastic volunteers who run these a great modern facility) and serviced rooms above for homeless people to sleep in?
As council funding and staffing cuts by the government bite deeper and deeper, why not convert the empty part of the local town council house offices?
Actually why not each political party or MP’s donate part of their premises in towns to be converted to serviced rooms for the homeless….let them be as charitable as they expect estate agents to be.
Apologies for duplicating post…had a problem
The debate link is not working
It’s working now – thanks for bringing it to my attention
Here to help 🙂
“In terms of dealing with statutory homelessness, access to the private rented sector is key”.
Yep all MP’s have failed miserably at dealing with housing and they now realise that they can’t cope without the private sector. So what do they do, shaft the private sector, bite the hand that feeds them and slowly but surely start to take control and steal the industry bit by bit to help get them out of a situation they have grossly failed at. The public and MP’s go to work to be paid … they expect agents not to be paid but to help bail them out with dodgy tenants who cause £K’s of debt and damage. When will MP’s wake up to the fact that lettings is a high risk business and without safeguards to weed out the tenants from hell many will leave the market creating even less housing. There has to be a commitment from the tenant at the very beginning and a responsible reference fee’s is the most important. If they go down this route, just about all landlord’s will put rents up. We are not a charity.
Actually why not each political party or MP’s donate part of their premises in towns to be converted to serviced rooms for the homeless….let them be as charitable as they expect estate agents to be.
Government appears to be full of idiots who have no understanding. I have invested my hard earnt cash on providing homes in the private rented sector to be constantly attacked by politicians who waste their time at my cost in taxes. If they want to start solving some of the problems reverse their lunatic decisions.
They asset strip the social housing and sell of council houses. Housing we as the public have paid for. These are purchased by their tenants at a massive discount. So the governments have even under-sold the housing paid for by the tax payers thus acting wholly inappropriately (not to mention ripping off tax payers). They have then forced people into a private market where they do not like the terms being offered by landlords so these idiots then legislate and attack landlords which will ultimately drive investment away from that sector.
Talk about repeating your own mistakes – look at the health service where they all moan about lack of beds when the idiots (MPs) have allowed and encouraged closing of hospitals and A&E departments. What do they expect. Der!!!!!!!!!
If Government, Shelter, Generation Rant put efforts into providing social housing the would start to address the real problems; but as they say talk is cheap!!
But putting money into social housing and the NHS, detracts and takes away from the extra tax breaks for the very wealthy and super rich companies.
Just out of interest, as someone who takes a great deal of interest in the medical area, one of the biggest problems for the NHS is that hospital beds are full of people that should be back in the community, being looked after there….but because support services in the community have been cut so much.. there is not enough capacity.
Every care home that closes through lack of funding is tens of beds that will be blocked in the NHS. And every family with carers who are at their wits end through lack of support..means there is no incentive to get their relatives back out of hospital as soon as they can.
Fine AgentV but who funds it and makes the decisions emmm! Oh that’s it our Government! Moreover, closing A&E departments and local hospitals HAS reduced the number of beds when demand was increasing. Politicians just stop blaming everyone else for your own failures. My pop is not at the people who are working in the NHS at the sharp end most of whom I have found to be wonderful dedicated people. I would not say the same about the mangers though.
Here’s an idea – how about all social housing tenants that have benefited from taxpayer funded subsidised rents and then massive discounts to purchase their properties pay a ‘WINDFALL TAX’ the proceeds of which go towards funding replacement stock?
Here’s a thought – if homelessness is a “moral stain” why not build some houses? Mr Barwell can’t blame landlords for a lack of supply when it was his lot who sold off all the social housing stock.
Government makes mistake -> punishes the public to try and recover it (while selling it as an opportunity) -> makes further mistake in doing so -> punishes public again. Cycle continues ad infinitum.
Until our government has people who experienced in the sectors they deal with (like the Canada model) every single sector in the UK, both private and public, is in jeopardy. But it won’t change.
Why not build a small apartment block in every town with a problem, with a communal kitchen and social area on the ground floor, together with a food bank (giving the fantastic volunteers who run these a great modern facility) and serviced rooms above for homeless people to sleep in?
As council funding and staffing cuts by the government bite deeper and deeper, why not convert the empty part of the local town council house offices?
“Nah, we’ll just ban tenant fees cos that will create more houses than more houses will create.”
Am i missing the point or are these idiots trying to say that people are homeless because they cant pay tenant fees, and then homeless again down the line because they are being evicted. It is a real issue homelessness, but to plant this yet again at the door of letting agents is disgraceful.
If someone is homeless, a letting fee ban isn’t going to help them at all, pretty sure not having to find £200 ish, will magic them into a property, and re section 21, well if you cant pay your rent, then you shouldnt be living in someone elses property. As has already been mentioned, previous reluctant landlords who are now selling is part of the reason for tenants having to leave, but again that isnt the agents or the owners fault.
Problem here yet again is the lack of house building. No doubt 2020 will come and go, with very little of the 100,000 or 200,000 (or whatever figure it is these days) being built. GOVERNMENT, GET YOUR OWN HOUSE IN ORDER BEFORE YOU START BLAMING OTHERS!
I do wish he would make his mind up
http://www.independent.co.uk/news/uk/politics/letting-fees-ban-landlords-gavin-barwell-attacked-a7433566.html
We have had two situations in recent years where landlords wanted to sell their properties and the tenants were advised by the council not to vacate by the set notice period because they could not be re-housed. The council would only find them new accommodation once they were evicted. The landlords then had to start going through that difficult and time consuming process, when all they wanted was to sell their property, whilst giving two or three months notice to their tenants.
its no wonder that the majority of good landlords do not want to consider tenants on housing benefit….they see it as a load of trouble waiting to happen!
I assume you are aware of the national guidelines about when they should be treated as homeless? They are a framework brought about as a result of the localism act and make very interesting reading. I am currently in the same boat as you. The local authority are saying they don’t have any accommodation and have said wait until you are evicted. So where will they house them then? My argument is that is they have somewhere when they get evicted they must have somewhere now??
Paragraph 37 – https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/270376/130108_Supplementary_Guidance_on_the_Homelessness_changes_in_the_Localism_Act_2011_and_on_the_Homelessness_Order_2012.pdf
That point always appears to be avoided by teh council but they quick to dictate to me!
I totally agree Pierce.
I am sure there are training courses run by ‘consultants’ whereby they stipulate ‘Make the process as difficult as possible for people and half the time the problem will go away of its own accord’. In other words the landlord will give up on trying to sell his property. It is outrageous that this situation is aloud to exist. What does it also do for the record of the tenants and their ability to rent in the future.
‘Well Mr Tenant, why exactly are you leaving your existing property?’
‘I am being evicted’
‘I see, well that isn’t really going to have any affect…when are you looking to move in….presumably on the same date as your eviction.’
Stick me in the Tower but we have a housing system that is not fit for purpose; unqualified, inexperienced someones making arbitrary decisions like monkies trying to bash out the first paragraph of Henry VI part one on a typewriter.
There’s a good chunk of 20 years of SA105 Land and Property tax uncollected from the PRS. I appreciate the public sector unions will be aghast at the scythe that should be swept through HMRC and the inefficiencies of having lots of tuppaware wielding staff wandering aimlessly through the occasional Section 19 but that is where government needs to start; collect the money owed, about £40 billion, and then set about getting a thorough and cohesive plan together. To do that they need people who understand what they are doing not just those who haplessly happened on a position of influence.
There is no point hitting the dislike button, SA105 L&P is an opt in system that is not policed. HMRC are clueless as to the number of landlords, companies, sivs and criminals who ought to be making tax returns and so are reliant on an under- funded system of monitoring and collecting tax from people too honest not to subscribe.
What the likes of Barwell, Blackman and Dromy (sounds like a firm of lawyers) fail to get a grasp of is that there are two very different sectors to the PRS.
On the one hand there is the sector populated by criminal landlords, dodgy letting agents and vulnerable, exploited tenants.
On the other is the sector populated by decent landlords, properly managed agents and properties, and tenants who get a perfectly acceptable deal.
If these muppet politicians hit both sectors with the same draconian levels of taxation and legislation then they should not be surprised if decent landlords decide to withdraw or sell off their properties from the PRS.