Queen’s Speech 2017 – lettings fees to be banned

The Queen’s Speech delivered on 21 June 2017 contained an announcement confirming the Government’s plans to introduce a new Tenants’ Fees Bill, which will essentially bring to an end the practice of tenants having to pay lettings fees to agents.

Fees are currently paid for services such as obtaining credit checks, investigating immigration status and taking up references.  It would appear that, when the proposed Bill becomes law, landlords will have to pay for such fees themselves.  ARLA Propertymark, an association representing letting agents, has commented that, as a result, it is likely that these fees will instead be charged to landlords who are, therefore, likely to attempt to pass on the cost to tenants, through increased rents.  Market forces will dictate whether this comes to fruition.

The proposed Bill will also allow tenants to recover any fees that have been charged unlawfully to them.

The Government has confirmed that it is introducing the new measures to make the lettings process more transparent, as tenants are currently charged differing amounts.  Letting agents’ fees are already banned in Scotland.

The Government has confirmed that a draft Bill will be published ‘later this year.’ We will provide more detail on the proposed regulations at that time.

If you are a landlord or letting agent requiring clarity over these changes, or a tenant wishing to understand your legal rights going forward, then please do not hesitate to contact our expert Property Team at MKB on 01226 210000.