As of 1st June 2019, the vast majority of lettings fees to tenants have been banned in England, and the government believes that these measures will save renters approximately £240m a year.
The new law applies to both new tenancies and renewals of existing tenancies, meaning that landlords and agents can no longer charge for a range of fees charged for items including unspecified administration and credit checks.
In addition, landlords and agents will no longer be able to charge an unreasonably large deposit which can add a further burden to people wanting or needing to move home. The maximum deposit for the majority of renters is now set at five weeks’ rent for any property where the annual rent is less than £50,000.
It is estimated that each move previously cost tenants between £200 and £800 on average, though there are reports of costs spiralling to into the thousands of pounds.
James Brokenshire MP, the housing secretary, said: “This government is determined to build a housing market fit for the future. Tenants across the country should not be stung by unexpected costs.
“That’s why we’re delivering our promise to ban letting fees, alongside other measures to make renting fairer and more transparent.”
Dan Wilson Craw, director at Generation Rent which led the campaign, spoke positively of the new law and emphasised the positive aspects for renters, saying: “The ban on letting fees won’t just save tenants money when they move home – it also gives them more negotiating power with their landlord. If faced with a rent increase or failure to fix a faulty boiler, tenants can now threaten to move out with more credibility, which should make the landlord think twice.
“For the ban to work, local councils must use their powers to crack down on illegal practices – and tenants need to know when to report dodgy behaviour in the first place.”
Landlords or agents charging these fees can now be fined up to £5,000 pounds for the first offence and face an unlimited fine if they reoffend within five year, meaning it is important for these parties to make sure they are aware of the rules.
For further information on the Tenant Fees Act, and what fees can still be charged to tenants, click here to see our dedicated page.