Labour’s manifesto, published yesterday, has confirmed that the party will ban letting agent fees if it wins the election.
The manifesto also confirms that it will legislate to make three-year tenancies the norm and introduce rent caps.
The manifesto says: “For the 11 million people who rent privately, we will legislate to make three-year tenancies the norm, with a ceiling on excessive rent rises.
“A ban on unfair letting agent fees will save renters over £600.
“We will drive standards up by creasing a national register of private landlords.”
The manifesto also says that Labour will build at least 200,000 homes a year by 2020. Under Labour, a “new generation of garden cities” would also be built.
In a further confirmation of plans previously announced, the Labour manifesto says a mansion tax will be introduced to help fund improvements to the NHS.
Meanwhile, Eye’s story yesterday alerting agents in Walthamstow, London, that Stella Creasy and her supporters were due to embark on a mystery shopping exercise of their fees was highlighted by her on Twitter.
She tweeted: “amazing @alexhilton – letting agents upset walthamstow campaigners wanted to see if transparent about their fees….#saysitall”
Thirteen minutes later, she tweeted: “Want to know why Walthamstow needs Labour Govt? Local letting agents upset asking about fees – lab would ban them!”
Taking letting fees away from tenants will make it harder for tenants to find a property in a very competitive market. If there is no cost of reserving a rental property there will be some people who will reserve multiple properties at no cost even though they only need one. They will have time to think about the one they want while other tenants have less choice. I think the government of they day will have to think carefully about this. Rash manifesto statements like this just show how we may be better off with the devil we know!
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Bearing in mind the OTM fiasco, Letting EA’s are likely to form their own political party to protect their industry – then vote for Labour…
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I have to ask, what are you on about?
If you stop and think about it Agent’s Mutual are best placed to deal with such a proposal if the British public have forgotten which political party put a couple of global conflicts and our economy metaphorically on a credit card once they had flogged off our Gold reserves.
As an affinity group which already represents 25% of the industry they have allies who designed, built, tested and rolled out contingency plans for this scenario when Campbell Robb and Shelter started lobbying for a ban 5 years ago. The biggest hurdle to an un-interrupted continuation of business as usual would be the volume take up.
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If I made a similar unqualified statement in my ‘manifesto’ like ‘…save renters over £600’. Then someone would be marching me down to Trading Standards for a ticking off!
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Excuse me for not having read the Labour manifesto but I wonder if it mentions a justification for charging stamp duty on homemovers ?
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‘OTM fiasco’ – what fiasco?
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Vote LABOUR!!! Why wouldn’t you? They win and then we get to do a part of our job for free! Oh wait
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“Letting agents back Tories.” Can’t understand why Central Office aren’t shouting that from the rooftops…
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What would stop an agent from charging his/her time out to a tenant to help them fill in reference forms etc? Surely any government can’t stop someone charging for their professional advice advice? If a tenant wanted to do it themselves it wouldn’t cost them anything but an agent would be well placed to suggest that if they use the “assisted” service then there would be less chance that it would be filled in incorrectly and that could lead to a speedier decision?
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The way Labour go on, you’d be forgiven for thinking the ONLY problem with housing in the UK is letting agents’ charging fees to tenants.
I agree there is a problem, but the answer is to cap fees to tenants, not to outlaw them. But I guess that might not attract so many votes. And after all, the only people who don’t really care about the long term effects of all this is… Labour.
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Actually that is the only bit they know about. They understand the bit of iceberg they can see but the bit under the water doesn’t exist. They are wholly reliant on Shelter for their policy on PRS and have to be, there is simply no comprehension of letting and mangement other than the bit they got charged when they wanted to rent in London. Their’s isn’t policy it is misplaced revenge.
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We will need a definition of ‘fair’ and ‘unfair’ fees. It is fine to ban ‘unfair’ fees but illogical to ban ‘fair’ fees.
We choose not to charge a reservation fee (but might if a tenant wanted a delay before moving in) but instead charge the tenant to be referenced by a professional company. We treat that commitment as a reservation and to my mind, this is a fair fee.
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Why not ban Solicitors or Mortgage Advisor’s fees while you’re at it?
In what other industry would there be a ban on fees for carrying out a vital service to the public? The property market props up our economy, and this sort of hit on the private rented sector will result in fewer high-street/traditional Agents. Granted, it might get rid of some of the bad ones and make it look less appealing to those looking to make a quick buck, but it removes profitability for genuinely good Agents, probably meaning a rise in the usage of online ‘Estate Agents’…as much as for some this is a well-loved idea, I think the tide of opinion will turn when people realise the difference in not having someone to guide you along an increasingly tricky process face-to-face.
I never though I’d vote Conservative, but for the sake of my industry and our economy I feel I have no other choice.
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Hang on, we are all talking about Labour winning (or losing) votes dependant upon which side of the rickety fence you sit, but the truth of the matter is that there is a bigger picture here. They are going to stop us charging the tenant fees, well someone has to pay for our businesses to run, Shelter forget we are not run as charities, so we will have to pass those costs to the landlord who would then, naturally, as they own the properties for business purposes and are not charities either, look to recharge this in higher rents as in Scotland to ensure they are still in profit…. but wait, no, they are going to get rent caps to go with those fees! So basically the landlords lose. Answer, landlords will sell their properties so there will be less choice and availability to prop up the social housing market.
I agree that there is nothing wrong with capping fees and, in fact, I am not against abolishing them (we are creative types in the lettings business, lets be honest we have to be with some of the queries we get!) so we will find a way to work with that one way or another, but to then add in rent caps, well… Nothing like over legislating an issue to win a few votes from people that can’t see any further than the end of their nose!
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If Labour get in, Lord help ANYONE in business…
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3 year tenancies, rent caps, ban on fees. This interfering from politicians once again proves they do not have a clue what happens in the real world. There are so many unanswered questions with all of this but 2 that spring to mind are that will we be able to charge a cancellation fee? Perhaps keep quiet about that one and do it anyway. What about the accidental landlord who rents a house until the market improves? With a 3 year tenancy they will more than likely miss the market. How can that be right? I’m flying out of the country on the 7th and may not come back for a while. Not that I’ll be missed.
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Okay ban letting fees, How about we charge the tenants to view! £30 per view, get rid of a lot of timewasters and makes us less of a charity!
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A great idea! Problem is we would get more no shows from them than we do now 😛
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Money up front, let them not show up! 🙂
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Labour has to be the most anti business party going. They had enough chances to build homes and all that rubbish they talk about now in the Blair Brown years. They brought in HIPS and the Tories rightly got rid of them. Estate Agency is an easy target. So they will expect the landlord to foot the cost of the references now as well. Well i certainly wont work and its absurd policy. I certainly wont vote Labour just on the strength of this one policy in their pathetic manifesto. The Tory man rightly said Miliband will stab anyone in the back for power just like he did his own brother !
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