On 1st June 2019 landlords and letting agents in England will be prohibited from charging fees to tenants.
Great news for tenants who can now happily hunt for their new home without the added pressure of sourcing additional funds for fees. Not so great news for Landlords who may find their fee is increased to counteract the loss of revenue.
There have been murmurs of increasing rents to counteract the ban, although this is doubtful – and something that only occurred in 2% of rental properties in Scotland when they introduced the ban in 2012.
Are you a Landlord?
Be sure your agent is transparent with their fee charging process.
Try to lock down a fixed fee period so you can be sure the fee isn’t increased from one month to the next as the agent understands how the loss impacts them.
Discuss the level of service you want from them – it may well be most cost effective to secure full management than just a let only offering.
Your agent may suggest a rent review but ensure this is line with market rents – pricing your property out of the market will just increase voids.
Are you a Tenant?
Check you are not being charged for anything that could be classed as an “agency fee” – rather than a product you are purchasing. For example you may need to purchase tenants content insurance from the agent which is a charge that is allowed. However a fee for a tenancy agreement or a reference is not.
Make sure the deposit that the agent is requesting is capped at 6 weeks
Be sure to carefully read your tenancy agreement for any associated costs during the course of the tenancy. For example tenancy amendments fees are capped at £50 but are allowed if you need to change items such as swapping tenants.
NPP Lettings are offering 7% fixed management fees for their landlord clients. For a free portfolio consultation or to find out how the fee ban could affect you, click here.
Tel: 0161 639 0050