Government Plan For Transparency Of Letting Agent Fees
Welcomed By Landlords
The Government announced last week that they intend to improve the transparency of fees charged by letting and property management agents as called for by the Residential Landlords Association (RLA).
The move comes after the Labour party’s general election posturing early last week by attempting to seek an amendment to the Consumer Rights Bill, ending charges paid by tenants to letting and property management agents,
Whilst the Advertising Standards Authority (ASA) currently only requires letting and property management agents to list compulsory charges to the tenant upfront in advertisements, proposals announced on Tuesday 13th May 2014 will require letting agents to publish full details of all fees charged, on websites and prominently displayed in their offices.Any letting or property management agent found not complying with the new rules will face a strict and very large financial penalty.
The Government hope that the move will ensure a fair deal for landlords and tenants, closing the loophole for the minority of rogue operators to impose unreasonable, undisclosed and otherwise hidden charges. The Government think that the common sense approach avoids excessive regulation which could increase tenant rental costs.
The Government are now working to draft their own amendment to the current legislation and details are expected very soon.
RLA policy director Richard Jones, welcomed the Government’s decision to amend legislation and confirmed that the RLA have been lobbying Government for the kind of transparency announced last week, stating: “Labour’s plans would have only served to increase tenant rents as many landlords would in all likelihood have passed the extra costs of having to shoulder all charges levied by letting agents onto tenants. The announcement will prove good for tenants and landlords alike and the RLA are looking forward to working constructively with the Government to see its full and successful implementation”.
Housing Minister Kris Hopkins said “The plans add to the work the Government is already doing to offer stronger protection for landlords and tenants in the private rental sector, whilst avoiding excessive regulation which would force up rents and reduce choice. The vast majority of letting agents provide a good service to tenants and landlords. But we are determined to tackle the minority of rogue agents who offer a poor service. Ensuring full transparency and banning hidden fees is the best approach, giving consumers the information they want and supporting good letting agents. Short-term gimmicks like trying to ban any fee to tenants means higher rents by the back door. Excessive state regulation and waging war on the private rented sector would also destroy investment in new housing, push up prices and make it far harder for people to find a flat or house to rent.”
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