Property News

ARLA Propertymark Responds to Welsh Consultation on Lettings Fee Ban

Rose - September 4, 2017

ARLA Propertymark (the Association of Residential Letting Agents) has responded to the Welsh government’s consultation on its proposed lettings fee ban.

The consultation, which launched on 19th July, proposes a ban on letting agents charging fees to tenants.

ARLA Propertymark Responds to Welsh Consultation on Lettings Fee Ban

ARLA Propertymark Responds to Welsh Consultation on Lettings Fee Ban

It now looks likely that tenant fees will be banned throughout the UK; Scotland already has a ban in place, while the English government has committed to introducing a ban, which is likely to take effect next year. Northern Ireland also had a consultation on a proposed ban, which closed in April.

The consultation in Wales follows pressure from the likes of housing charity Shelter. In March 2016, Shelter Cymru published the report Letting go: why it’s time for Wales to ban letting agents’ fees.

It said that there were large discrepancies between fees charged to tenants, ranging from a low of £39.99 to £480. The report also found that one in three tenants who use a letting agent paid over £200 in fees to begin a tenancy.

The consultation document says: “In terms of reforming the private rental sector, the Welsh government has already gone much further than other parts of the UK in regulating landlords and letting agents through Rent Smart Wales.”

This is a compulsory scheme by which all landlords must be registered and all letting agents must be licensed. Many landlords will also have to be licensed, based on whether they perform property management tasks.

The consultation says that while letting agents are required to display their fees, a mystery shopping exercise found that half did not.

The Welsh government believes that many fees charged to tenants are “unjustified and arbitrary”.

The consultation asks a number of questions, aimed at determining “which fees, if any, are justifiably being charged to tenants”.

It also seeks information on fees paid by landlords to letting agents and the possible consequences of a fee ban.

David Cox, the Chief Executive of ARLA Propertymark, responds to ARLA’s submission to the consultation: “Any move to ban letting agents fees in Wales will cause unprecedented damage to the rental sector across the country. Independent analysis commissioned by ARLA Propertymark, following the UK Government’s announcement of its own ban, revealed that if a full ban was introduced, rents will increase by £103 per year, which will only serve to financially punish long-term tenants.

“In our submission, ARLA is calling for fees associated with referencing to be left out of any ban. Right to Rent checks will soon be a service that agents in Wales will be required to undertake by law, so it is only right that agents should be able to recover the associated costs, given the time and resources needed to carry out such checks.”

The consultation closes on 27th September.

It can be found here: https://consultations.gov.wales/sites/default/files/consultation_doc_files/170721_consultation_feeschargedtotenants_en_1.pdf

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