Under new plans announced by Government ministers on 13th May 2014, letting agents are now required to publish full details of the fees they charge. Transparent fees ensure fair deal for landlords and tenants.
The obligation will ensure landlords and tenants receive fair treatment, and attack the rogue agents that enforce excessive and hidden charges on customers. This method also avoids unnecessary state regulation, which would increase rents for tenants.
Previously, the Advertising Standards Authority required letting agents to list obligatory charges to the tenant upfront, however, these letting agents have sometimes charged hidden fees, and face no more than being listed on the Advertising Standards Authority’s website.
Transparent Fees Ensure Fair Deal for Landlords and Tenants
However, the Government wanted to do more, and will now oblige all letting agents to publish a complete list of fees on their websites and offices. Those that do not observe the rules will face a fine.
The new plan enhances the Government’s work to provide stronger protection for landlords and tenants in the private rental sector, whilst avoiding extreme regulation.
Kris Hopkins, housing minister, says: “The vast majority of letting agents provide a good service to tenants and landlords. But we are determined to tackle the minority of rogue agents who offer a poor service.
“Ensuring full transparency and banning hidden fees is the best approach, giving consumers the information they want and supporting good letting agents.
“Short-term gimmicks like trying to ban any fee to tenants means higher rents by the back door. Excessive state regulation and waging war on the private rented sector would also destroy investment in new housing, push up prices and make it far harder for people to find a flat or house to rent.”1
The Government will make the amendment to the Consumer Rights Bill at a later date, when they have reviewed the operation after 12 months to ensure that it is providing the predicted benefits.
The Government previously introduced new legislation that requires all letting and management agents in England to belong to an approved redress scheme. Housing minister Kris Hopkins has approved three schemes that must be joined later this year.
The three schemes, the Property Ombudsman, Ombudsman Services Property, and the Property Redress Scheme, offer independent inquiries into complaints about hidden fees or poor service. Tenants and landlords could receive compensation if a complaint is defended.
More measures being proposed include:
- A code of conduct for managing property in the private rental sector.
- A how to rent guide for tenants to know what to expect from their letting agency and/or landlord.
- A voluntary, model tenancy agreement, which could be sued for longer tenancies.
- More guidance for local councils on challenging rogue landlords, defending tenants from illegal evictions, and pushing for harsher penalties before magistrates for housing offences.
The Government is also raising investment in building houses, and also institutional investment in private rental accommodation.
The £1bn Build to Rent fund will provide finance for large-scale private rental homes, and could build up to 10,000 new houses for private rent.
The Government’s housing guarantee scheme supports up to £10bn worth of investment in large-scale private rental projects and further affordable housing.