Tenants have been made to feel somewhat of an afterthought in the rental process ever since the lettings boom of the early 1980s. The business of the UK residential lettings market starts with landlords, who own the “stock” (i.e. the bricks and mortar) letting agents desire.
Combine the need to let rental properties with an already overcrowded market of tenants (especially in London), and you can start to see why these tenants have become secondary: demand far outweighs supply.
However, everything is about to change with the Draft Bill of the Tenant Fees Act, which sees letting agents no longer able to charge admin fees to tenants. The result will see renters potentially save thousands of pounds – a triumphant win for tenants throughout the UK.
But how does it affect the wider landscape of the lettings industry in the UK?
Charges No More
Before the Tenant Fees Act’s Draft Bill was passed in the House of Commons, letting agents were able to charge tenants for admin fees, credit checks, referencing, guarantors, inventories, cleaning, gardening services, renewals and even exit fees.
Renters were culpable of paying around £350 for admin charges, up to £100 on referencing, and £50-plus on a guarantor (if needed). By this point, all the tenant would have done is indicate that they want to rent the property.
With 4.7-million people privately renting in the UK, such fees placed too much of a burden on the tenant, pretty much ending any hope of tenants saving for a home.
Thanks to the new legislation, agents can no longer charge for fees. It also stipulates that holding deposits are capped at one week, while deposits are also capped to five weeks. The result should see tenants having more flexibility when looking for somewhere to live, safe in the knowledge that their pockets won’t be quite so empty before they have even moved in.