Tenant fee ban to come into effect on 1 June

The ban on letting agents charging fees to tenants to set up a new tenancy, or renew an existing tenancy, will come into effect on 1 June 2019.

The announcement was made by Lord Bourne of Aberystwyth, the government’s housing spokesperson in the House of Lords during the Bill’s third reading yesterday.

He said: “Implementation is subject to the parliamentary timetables and amendments need to be considered in the other place (the House of Commons).

“We need to enable agents and landlords following Royal Assent to become compliant but we intend for the provisions to come into force on June 1st 2019. This would mean the ban on lettings fees would apply to all tenancies signed after this date.”

The ban affects the upfront fees letting agents currently charge before tenants rent a property. These include administrative fees, credit check fees, tenancy renewal fees and referencing costs. In the future these costs will be borne by the letting agent – or passed on to the landlord.

When the ban comes into effect, the only fees renters will legally be able to be charged will be: the rent, a refundable security deposit, a refundable holding deposit, and ‘default fees’ for events such as lost keys or late rent.

The new legislation introduces a cap on security deposits at five weeks’ rent. This is lower than the six weeks’ rent initially proposed. Mortgage Strategy reported in December that the deposit cap would be lowered – a move that angered landlords.

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