LANDLORDS and letting agents are banned from charging tenants extortion fees stopping millions from being ripped off from today.
Three years after it was first announced, the long-awaited Tenant Fees Act is finally here giving renters more rights over agreements for their homes.
1 From today, letting agents and landlords are banned from charging tenants unnecessary feesCredit: Iain Sharp / Alamy Stock Photo
The laws are part of a wider shake-up in the private rental sector in an attempt to improve relationships between tenants and landlords.
Private renters in England have been paying £13 million a month in letting fees, which is a total of £234 million, since the government committed to banning them in November 2016, according to Citizen’s Advice.
The rules apply to all new short hold tenancies for privately rented properties that are taken out from today, and caps the amount landlords and letting agents can charge for deposits and fees.
Agents risk being fined £5,000 for breaking the rules, and could be taken to court if they offend again where the penalty could be extended to up to £30,000.
Some landlords fear that they will now be forced to hike rents by up to £270 a year as a result of the ban, according to MakeUrMove, but ARLA Propertymark boss David Cox says this will only be felt by long-term renters.
But not all of the fees are banned under the new rules. Here’s the lowdown on your rights now that the Tenant Fees Act is law:
Which fees have been banned?
Under the new act, tenants and landlords can’t charge you:
To view a property,
For a reference or credit checks,
For costs to cover “admin” including things like referencing, credit checks and guarantors,
Renewal fees for tenancies taken out after June 1 2019,
Charging for a professional clean, unless they have good reason – and evidence – to,
Which fees have been capped?
Up until now, landlords and agents have been able to charge unlimited amounts for fees but now some of them have been capped.
This is to make things fairer for both the tenant and the homeowner.
Leaving your tenancy early
There are a few charges that you may have to foot the bill for such as leaving your tenancy early.
Normally, this is a fee charged to cover any financial losses and reasonable costs incurred for terminating your contract before the term is up.
But this fee will now be capped at no more than the amount of rent you would have paid until the end of your tenancy.
How to haggle with your landlord and bring down your rentWHEN you first sign your tenancy agreement with your landlord your rent should be agreed either in writing or verbally.To increase your rent your landlord must send you a section 13 notice which gives you a month’s notice in writing telling you how much your rent will be increased by and the date when your rent will go up.
At this stage you should try to talk to your landlord and come to a fair agreement on how much rent you should pay.
Your landlord can only raise your rent if you agree to the increased price.
Matt Hutchinson, communications director for flatsharing website SpareRoom.com said that if you are a good tenant then you’ve got bargaining power.
“The first thing to bear in mind is that demand is lower at the moment than over the past couple of years.
“That means you’ve got a bit more bargaining power, especially if you’ve been a good tenant, as your landlord won’t want the expense and hassle of having to find another tenant and even potentially face a period with the property empty.
“Failing that, it’s worth seeing if you can get anything thrown in with a rent increase, such as minor bits of redecorating or any bills.”
Landbay have a free rent check service to see how much rent you should be paying in your area.
You can find the rent check service here.
Find out more about how to haggle with your landlord to bring your rent down here.
Agents and landlords will only be able to charge you the equivalent of one week’s rent to take the property off the market and they are also banned from continuing to advertise property once they’ve received the payment.
The fee will have to be repaid once the tenant has signed the agreement or 15 days if the agreement doesn’t go ahead.
If you want changes made to your contract, such as what day you pay your rent, then the amount an agent can charge you is capped at £50.
If the agent thinks it will cost more than this they will need to provide proof upfront.
Payments that are more than 14 days over due is considered late. Landlords can only charge you for this if it’s written in your contract.
The fee should be no more than 3 per cent more than the Bank of England’s base rate – currently at 0.75 per cent – for every day that the payment is late.
Before, landlords could charge up to six weeks worth of rent for a deposit but now it is capped to five weeks.
Although it’s a step in the right direction, some campaigners such as Generation Rent don’t think that it’s enough.
What can my landlord or letting agent charge me for?
A tenancy deposit
A holding deposit
Replacing lost keys
Any changes you request to your contract
Bills such as water, broadband, TV licence and council tax
Terminating your contract early
Late rent payments (after 14 days)
Cleaning fees in extreme circumstances.
What about existing tenancies?
Unfortunately, the ban on letting agency fees doesn’t come into effect for existing tenancies taken out before June 1 2019.
Letting agents and landlords can continue to act on the old rules for these agreements until June 1 2020.
That means if your contract is up for renewal before then, you’ll still have to fork out the charges.
GET YOUR OWN BACK Renters can get £192 back from landlords from today thanks to new fee ban RENT RESENTMENT My girlfriend’s ex ruined her credit score and we can’t rent a decent place WAITING GAME Renters warned not to sign new tenancy agreements this week as it costs more NO ROOM Young families FOUR TIMES more likely to downsize than elderly couples RENTAL PAIN Renters facing price rises as landlords sell-up and cash in on property HOUSE RULES Renters share landlord horror stories including ‘don’t take big s**ts’
The ban also won’t apply if you signed an agreement before June 1 but don’t move in until after that date.What to do if you think you’ve been wrongly charged
You can complain to your local council which has the power to fine a landlord or agent who has charged a banned fee, according to Shelter.
If the landlord or agent refuses to give you the fee back, tenants can apply through the First Tier Tribunal, as long as they agree the fee was unfairly requested.
Your council will be able to advise you on how to complain through the tribunal.
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