What the tenant fee ban really means for agents – The Property Chronicle
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What the tenant fee ban really means for agents

Investor's Notebook

Should letting agents be worried about the impact of new legislation?

The Tenant Fees Act 2019 or, as it’s more often referred to, the tenant fee ban, is a piece of legislation that came into effect on 1 June 2019 and basically prohibits landlords or letting agents from charging certain fees to tenants for the granting, renewal or ending of a tenancy. 

These banned fees are:

  • tenancy set-up fees
  • credit check and referencing fees
  • preparation of inventory
  • renewal fees
  • checkout fees.

Permitted fees are limited to:

  • rent
  • a holding deposit of no more than one week’s rent
  • a security deposit of no more than five weeks’ rent (six weeks if annual rent is more than £50,000)
  • late payment charges. 

A penalty of £5,000 can be issued by the local authority for a first non-compliance, and a second offence committed within a five-year period carries a penalty of up to £30,000. 

The legislation has rocked the industry – understandably, as letting fees are a significant part of any letting agent’s income. For most agents, the only way to survive is to pass these fees onto landlords, who in turn are demanding increased rents to compensate.






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