Tenant Fees Bill sees first reading in The House of Commons

Michael Lloyd

May 2, 2018

The Tenant Fees Bill that sets out the government’s approach to banning letting fees paid by tenants and capping tenancy deposits in England had its first reading in The House of Commons today.

The aim of the bill is to reduce the costs that tenants can face and is part of a wider package of measures aimed at rebalancing the relationship between tenants and landlords.

Tenants will be able to see, at a glance, what a given property will cost them in the advertised rent with no hidden costs.

David Cox, chief executive, ARLA Propertymark, said: “The day we have been expecting since the Chancellor announced the ban on tenant fees in the Autumn Statement 2016 has arrived, with the Tenant Fees Bill beginning its passage through Parliament this afternoon.

“We do not believe the Bill will achieve its aims, as our own research last year demonstrated that tenants will end up worse off and banning fees will not result in a more affordable private rented sector.

“ARLA Propertymark has worked hard over the last 18 months to explain the unintended consequences of the ban to government, and we’re pleased they have listened and allowed Change of Sharer, Surrender of Tenancy, holding deposits, exempted the Green Deal Charge, and capped security deposits at six weeks, rather than the Committee’s proposed five-week cap. Now that we have greater clarity on what the ban will entail, agents must start preparing for when it comes into force.”

The landlord will be responsible for paying for the service, which will help to ensure that the fees charged reflect the real economic value of the services provided and sharpen letting agents’ incentive to compete for landlords’ business.

Introduction of the Tenant Fees Bill follows pre-legislative scrutiny of the draft Bill which was conducted by the Housing, Communities and Local Government Select Committee last November.

In March The Select Committee published recommendations and agreed it has the potential to save tenants hundreds of pounds.

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