Queens Speech confirms abolition of tenant lettings fees

It was confirmed in the Queen’s Speech that the new minority Conservative government will ensure that “unfair” tenant fees are banned.

A new Tenants’ Fees Bill was announced, which will stop tenants having to pay money to lettings agents.

It is thought the bill will pass easily, given all main parties mentioned banning the fees in their election manifestos.

Chancellor of the Exchequer Philip Hammond initially proposed the decision to ban letting fees during the Autumn statement last November. In April, the government’s consultation on banning tenant fees was finalised, confirming the government’s intention to abolish letting fees. The Queen’s Speech outlines the government’s proposals for the next two years.

The measure means that no letting agent will be allowed to charge their tenants any fees, premiums or charges that facilitate the granting, renewal, or continuance of a tenancy. The government’s consultation made it explicit that tenants will be only be required to pay their rent and a refundable deposit. This is because the ban also applies to any letting fees charged to tenants by landlords and other third parties, ensuring that letting agent fees are not paid by tenants through other routes.

Those campaigning for the ban have said that it will benefit students as the quality of student accommodation has not improved despite a rise in the costs of living and rent.

Shelly Asquith, the Vice-President of Welfare at the National Union of Students (NUS), claimed that the average cost of student rent is approximately 85 per cent of the maximum student loan and grant available, which leaves students little money for other expenses.

The Office of National Statistics (ONS) have recently reported a 16.44 percent increase in rent prices across England (excluding London) from May 2007 to May 2017.

However, some students worry that that the decision to abolish letting fees will have a negative impact on their effort to find affordable housing.

English Literature and Creative Writing first-year Lucy May said: “This decision might seem like a good thing on the surface because you’ll be paying less straight away.

“But then if rent will go up to cover the cost then actually in the long run young people are being ripped off a bit and it’ll be even harder to get a house.”

UEA’s SU are aware of the impact this will have to students in Norwich.

Outgoing Campaigns and Democracy officer Amy Rust told Concrete: “On the face of it this is great news for students who regularly get ripped off on so-called ‘administration charges’– it’s often students that do all the research and organisation required to view properties and arranging paperwork.”

Miss Rust added: “The real danger is that this is used as an excuse to hike up rents- so it’s more important than ever in an area like Norwich that the university and council develop a proper plan on student housing that ensures supply keeps up with demand so that competition acts as a break on hikes.”

Some estate agents opposed the ban, fearing that it would affect their business’ rate of pay or even employment.

Speaking to Concrete, Liam from William H Brown Estate Agents said: “[The ban] will affect the market, as if fees go down or get abolished completely, the company won’t make as much money so will need to look somewhere else to make up for that loss in profit.

“Most likely, we will charge higher rates to landlords or something along those lines. What you will find is that rent may go up, because if we charge landlords more, they will want to put their rents up so they get their money that they’re losing out on. It’s sort of like a chain reaction.”

Norwich-based Blue Sky Lets told Concrete they “have never charged students letting fees”, alongside landlords co-operating with the SU under the Homerun service who presently do not charge tenants fees.

A draft bill is expected later this year.


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October 2021
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