For extended information on this topic, please visit our dedicated guide – Letting Agent Fees.
Important changes for tenants either in or about to enter into a private tenancy agreement
The new Tenant Fees Act is in force in England as from 1st June 2019. This act caps the amount renters can be charged for their deposits and bans the charging of letting fees altogether as part of the Government’s drive to reduce hidden costs for tenants.
The Government asserts that it expects to save tenants across England upwards of £240m a year through these changes. Below is a short guide to the main provisions of this Act
The new Tenant Fees Act?
The new Tenant Fees Act is designed to reduce the charges that tenants face from the outset of the renting process, throughout the life of their tenancy, and when their contract comes to an end, by abolishing hidden costs.
It bans landlords charging letting fees paid by private tenants in England, and caps the security deposits they have to pay at five weeks’ rent.
When does the Tenant Fees Act come into effect in 2019?
The new law came into force on 1 June 2019.
How will the new Tenant Fees Act affect tenants?
The changes are designed to ensure that private tenants are protected from unexpected and/or unfair letting fees that can make properties difficult to afford.
Tenants will no longer need to pay more than five weeks’ rent deposit and will no longer have to pay letting fees.
Holding deposits will from 1st June 2019 be capped at one weeks’ rent and tenants can only be charged £50 for a change to a tenancy, unless a landlord can prove the process has cost more than this amount.
The length of time it takes for landlords and agents to pay back any fees they may have charged unlawfully will also be reduced to ensure tenants get their money back quickly.
Landlords will be unable to remove tenants from a property using the Section 21 eviction procedure until they have refunded any fees or a holding deposit that renters were charged for unlawfully.
How will the Tenant Fees Act affect landlords and agents?
Landlords or their agents will only be able to recover ‘reasonably incurred costs’ and will need to provide evidence of what these costs are before charging their tenants.
These changes will hopefully bring an end to the practice by some landlords of overcharging renters for alleged damage or exaggerated costs for replacement of items.
Where a landlord or their agents ignore the ban on letting fees they will now, if proven, face a fine of £5,000, which can increase to £30,000 for repeat offenders or result in a criminal offence being committed.
Disclaimer: This article is provided as a guide. Any information should be used for research purposes and not as the base for taking legal action. The Tenants' Voice does not provide legal advice and our content does not constitute a client-solicitor relationship.
We advise all tenants to act respectfully with their landlords and letting agents and seek a peaceful resolution to problems with their rented property. For more information, explore the articles in our category.
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