Mike Ellis of Ellis Winters assesses the current housing market
The Tenant Fees Act 2019 comes into force on the 1 June banning all tenant fees charged by agents and landlords except those specifically permitted by the Act. The ‘permitted’ fees include rent, security deposits, holding deposits, early termination and some default fees. The ban applies to all residential ASTs in England entered into on or after 1 June, including existing tenancies that renew for a fixed term.
Tenancies continuing after 1 June on an existing fixed term or periodic basis will be bound by the terms in the current contract meaning agents and landlords will still be able to charge fees on these up to 31 May 2020. After this any fee taken will be classed as a ‘prohibited payment’. The other big change is the tenant’s security deposit which is capped at five weeks rent (or six weeks rent if the annual rent is £50,000 or more).
Letting agents are still required to display their fees schedule and client money protection in their offices and on their websites to make these as transparent as possible. The act will also enforce visibility on all additional advertising, whether this be rental pages like Rightmove or Zoopla, social media or magazines.
This undoubtedly will impact both landlords and lettings agents so it is very important to ensure that anyone considering letting a property is confident that the agent they use is accredited and knowledgeable about the current legislation.
If you would like some help or advice concerning the Tenant Fees Act, please contact any member of our experienced Lettings team on 01480 388 888.