The Consumer Rights Bill was debated within the House of Lords on the 4th November. An amendment was laid by the opposition to prohibit fees paid to letting agents. Responding for the Government, Baroness Neville-Rolfe said that a blanket ban on letting agent fees could not be the answer to tackling a minority of irresponsible agents and that banning fees would lead to an increase in rent prices.
ARLA (Association of Residential Letting Agents) supports the view that fees should be transparent and believes that better regulation is needed in the private rental sector to stop rogue agents charging over-the-odds tenant fees.
Their recent report on tenant fees* found that nearly three quarters (74%) of ARLA Licensed agents charge tenants no more than £250 in tenant fees. Overall, among the members surveyed the report found ARLA Licensed agents charge a reasonable £213 on average in tenant fees to cover the lettings process.
While many are concerned about tenant fees, David Cox, managing Director of ARLA, explains why they are needed: “Tenant fees cover the cost of essential items during the lettings agreement process such a reference checks, the drafting of the tenancy agreement, and the management of tenancy extension or renewal. All of these items cost the agent money to carry out, and in fact, provided the agent has a fair pricing structure, the agent will not make a noticeable profit on charging for these items. Renting a property is a big financial commitment and tenants should be made aware of what exactly they are being charged for and what they are getting for their money. ARLS supports openness and transparency when it comes to fees.”
Philip Chadwick, Gascoigne Halman’s Lettings Director agrees: “We are confident that our commitment to ARLA’s strict code of conduct demonstrably puts the tenant first. Openness, transparency and fairness are at the heart of everything we do. Clients should be cautious if dealing with agents who are not members of ARLA.”
*ARLA Licensed agents, based on 506 responses