Tenants hoping to save money from fees ban ‘could already be paying more in rent’

The letting fees ban may already be too late to save tenants money, a BBC programme has warned.

BBC Radio 4’s You and Yours show on Friday focused on letting fees amid the impending tenant fee ban being introduced on June 1.

Raji Hunjan, chief executive of anti-poverty charity Z2K, which helps low-income tenants pay their fees and deposits, said the ban was welcome.

She said: “The ban will make a significant difference to us.

“It is money we fund-raise for and could use in helping tenants to set up their own homes such as buying cookers or beds so they can live independently.”

The show’s presenter, Peter White, then said he gathered that rents have already risen, overtaking any savings from the ban.

No actual statistics were presented to prove this and recent figures from brands such as HomeLet and ARLA Propertymark have actually shown rental growth has been slowing, but Hunjan acknowledged that the market was becoming more competitive.

David Cox, chief executive of ARLA Propertymark, told the programme: “It is an interesting situation. It sounds like a great piece of law but these are legitimate costs of doing businesses.

“It takes eight hours to prepare a tenancy: that cost isn’t going away and will ultimately be passed on to landlords.”

He cited research released by ARLA Propertymark last year showing that rents will increase by an average of £103 per tenant.

White played a statement from the Government saying the ban would save tenants a total of around £240m a year.

But Cox disputed this: “That doesn’t take into account the increased rent tenants will have to pay.

“Rents are inevitably going to have to go up to cover these costs.”

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  1. Will2

    There is no such thing as free.  They are fools if they think there is.

  2. Northampton Landlord

    Sadly, most politicians have  never had a proper job.

    Anyone interested in Economics will understand that making anything “free” has a cost.

    The cost will appear elsewhere in the transaction.

    If the rent increases to compensate for the “free” element, the tenant pays more over the entire tenancy.

    The longer the tenancy, the more that the tenant pays.


  3. brownsea

    Nothing in this world is free and someone always has to pay.

    its interesting to read that most Landlords do there own letting and don’t use agents, so are why are landlords leaving in their droves??

    So why do we do referencing, charge for documents etc as agents and landlords not using agents do they charge anything??

    Question: Purplebricks now do lettings what do they charge for?? Surely somewhere there must be some legal work to do and no charge!! Does basic economics come into this business anymore??

    Frustrated letting agent, 20 + years and cant see a future in it!!

  4. Woodentop

    £25 PCM rent increase = £300 in the first year, towards lost reference fee’s is not a saving to the tenant. That cost would probably have been shared upfront had it been between a couple and often more than some agents charge for referencing (yes OK some agents were charging considerably more) but once you are in year two onwards £300 extra cost PA they wouldn’t have ever needed to pay.


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