The government has continued to raise the pressure on the residential lettings market. Following on from the impact of the Deregulation Act 2015 and the restrictions on the applicability of the accelerated possession court procedure, the Chancellor has announced the government’s intention to abolish fees payable by tenants to Lettings Agents.
"In the private rental market, Letting Agents are currently able to charge unregulated fees to tenants. We have seen these fees spiral, often to hundreds of pounds. This is wrong. Landlords appoint letting agents and Landlords should meet their fees.”
This move should have come as no surprise as this has been argued for by pressure groups for some time and this has been the situation in Scotland since 2012.
Predictions of dire consequences when Scotland brought in the ban appear to have come to nought as a report into the effect of this change on the Scottish lettings market in 2013 concluded that rents had not increased any more than elsewhere in the UK and less than one in five (17%) of letting agency managers said that they had increased fees to Landlords.
Nevertheless if Lettings Agents decide they are going to have to increase their fees to Landlords they are going to have to be better at explaining what services they provide – not just organising viewings, inventory preparation, and credit checks but also constant market analysis and ensuring their documentation and procedures are kept up to date in a rapidly changing legal environment.
For more information please contact Robert Cherry.