Patrick Oliver, Herts & Essex - What does the new Tenant Fee ban mean

Posted on 5th August 2019

WHAT DOES THE NEW TENANT FEES ACT 2019 MEAN FOR TENANTS AND LANDLORDS

by Zoe Kenworthy MNAEA MARLA 

Based in Bishops Stortford, covering the town and surrounding area

The law around what tenants can be charged for when starting new tenancies changed on Saturday 1st June.

The Tenant Fees Act applies to new tenancies and renewals of tenancies, meaning that landlords and letting agents can no longer charge for a range of admin fees, and tenancy deposits are now capped to five weeks.

This new legislation means that some tenants could save hundreds of pounds.

In England, the Tenant Fees Act 2019 means that in addition to rent, lettings agents can only now charge tenants (or anyone acting on the tenant’s behalf) the following permitted payments:

·         Holding deposits (a maximum of 1 week’s rent)

·         Deposits (a maximum deposit of 5 weeks’ rent for annual rent below £50,000, or 6 weeks’ rent for annual rental of £50,000 and above)

·         Payments to change a tenancy agreement eg. change of sharer (capped at £50 or, if higher, any reasonable costs)

·         Payments associated with early termination of a tenancy (capped at the landlord’s loss or the agent’s reasonably incurred costs)

·         Utilities, communication services (eg. telephone, broadband), TV licence and council tax

·         Interest payments for the late payment of rent (up to 3% above Bank of England’s annual percentage rate)

·         Reasonable costs for replacement of lost keys or other security devices

·         Contractual damages in the event of the tenant’s default of a tenancy agreement and

Any other permitted payments under the Tenant Fees Act 2019

The Act also states that a tenant cannot claim back any fees charged before 1st June 2019, from the agents and landlords. So, if an agent or landlord requires a tenant to pay a fee linked to a contract that started before the ban came into force, such as check-out or renewal fees, they can continue charging those fees until 31st May 2020.

This is good news for tenants as it will make it cheaper to move rental properties. But time will tell if rents will increase, due to agents increasing their Landlord’s fees. Our advice to Landlords is to check what their agent’s new costs are and to read the small print!

At Patrick Oliver our charge to Landlords, to find a tenant only, is 2 weeks rent, and then £50 for a reference check, per tenant or guarantor.


Our Bishops Stortford landlords rate us their number one agent, because we guarantee exceptional service coupled with exceptional value. 

Call Zoe Kenworthy today on 01279 510300 or Gemma Patrick on 01424 390100 for free, impartial advice.

 

Source: Rightmove

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