With the Tenant Fees Ban coming into place tomorrow (1st
June 2019), the next few months could present a challenge to letting agents, as
they work to recoup costs that they’ll no longer be able to claim from tenants.
Fees Ban is designed to shift the costs of renting from tenants to landlords.
However, doubts about how well the ban is likely to work include the possibility
that many landlords will avoid incurring the extra charges by increasing rents,
or not employing a letting agent, and dealing directly with their lettings
The National Landlords Association (NLA) is concerned
tenants may be limited from properties in areas with selective licensing. Most
selective licensing schemes require landlords to complete reference checks, and
if tenants are unable to satisfy these checks, landlords will be unable to let
properties to them without being in breach of the conditions of their selective
Richard Lambert, CEO
of the NLA, commented: “Tenants are at risk of losing out on the chance to
find a home because letting agents are doing everything they can to minimise
workloads to cut down on costs.
“While landlords who self-manage their portfolios will be
covering many increased in costs, letting agents are looking at any way they
can limit what they have to do on behalf of tenants, now that the costs cannot
be directly recovered.
“The smooth running of the housing market requires a little
give-and-take and, unfortunately, the reaction of some letting agents to the
ban on most charges looks set to throw-up more barriers to moving from one
tenancy to another.”
“Just like private landlords, letting agency businesses are
being put under increasing pressure by government regulation. However, they
must realise that penalising outgoing tenants by refusing to provide references
will ultimately cost them more than just the price of a reference as landlords
opt to do without agents altogether.”