Lettings agents in England will be banned from charging fees to tenants “as soon as possible” under plans announced in the Autumn Statement.
Mr Hammond said he would take aim at the charges letting agents can levy on tenants for services such as administration and referencing. The government believes the ban – to be brought in “as soon as possible” following a consultation – will help millions of households in private rented housing by sparing them what can amount to “hundreds of pounds in fees”
We have seen these fees spiral, often to hundreds of pounds,” Mr Hammond said. “This is wrong. Landlords appoint letting agents and landlords should meet their fees.”
But how will this affect Landlords and tenants moving forward?
If the costs are levied at landlords, will rents increase therefore tenants could well end up footing the bill anyway?
Will it drive up competition from potential tenants there the demand could be higher and rents may increase?
Thomas Crouch, Lettings Manager for Crucible Sales and Lettings said “I think that the announcement in the autumn statement that letting agents will be banned from charging tenant fees, will encourage more tenants to rent properties. I especially think this will entice first time tenants, such as younger people leaving their family home as the upfront costs for moving into the property will be reduced.
However I don’t believe this will be a good idea in the long run. In my opinion, I think that this will cause letting agents to increase the fees that they charge landlords, to compensate for the loss of income from tenant fees. Then in turn landlords will naturally want higher rents for their properties to cover the cost of the rising agent fees. This will end up costing tenants more in the long run, than having to pay agents fees would have in the first place.
Letting agents do need to be paid for the mainly administrative work done to move tenants in. I think it would have made more sense for the government to put a cap on fees charged to tenants, instead of banning them all together.”
Are you a landlord and have questions on how this might affect you?
Are you a tenant wondering if this will have an affect on you over the course of a tenancy?
Give Crucible Sales and Lettings a call today to discuss your lettings requirements on 01709 300333