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Labour MP's Intend To Introduce Regulation To Control UK Lettings Industry

Labour MP’s Intend To Introduce Regulation To Control UK Lettings Industry

The regulation of the private rented sector (PRS) and the UK letting industry as a whole has been the subject of many tabloid newspaper headlines in recent months and now MP’s are adding their weight to the calls for further regulations.

The subject of letting agent fees is now being used by politicians to create civil unrest among tenants and their landlords, in order to bring about even more regulation.

One of the many problems faced by tenants in the PRS has been highlighted by Hilary Benn, Labour’s shadow secretary of state for Communities And Local Government (CLG), who has spoken out over the high charges placed on tenancies by letting and property managing agents and she has claimed that some agents are ‘ripping off’ landlords and tenants.

The shadow secretary of state said Labour are concerned about commission charges and fees for additional services such as Tenant Referencing, credit checking, periodic inspections and sending letters.

The data gathered by the Labour Party suggests that agents’ charges vary to a huge extent, a worrying factor when it is considered that in 2013, the number of residential properties available to be rented out privately is set to exceed social housing in the UK for the first time.

Letting agent charges for Tenant Referencing and credit checking range from £10 (GBP) to an excessive £275 (GBP), while the charge for renewing a tenancy varied from £12 (GBP) up to £220 (GBP).

“What is actually £220 of cost in terms of administration if you had just to send an email, open an envelope and stick it in a file? That seems to me to be a rip-off. It’s a problem not just for tenants but also for landlords.” Said the Labour MP.

Hilary Benn and the Labour party have promised that they will look into ways to cap charges in the Private Rental Sector (PRS) and would be a widely welcomed move by Landlords and Tenants Groups across the UK.

Ian Fletcher, Director of Policy at the British Property Federation (BPF) said: “Anyone can set themselves up as a letting agent, and then potentially abscond with hundreds of thousands of pounds of people’s cash. It is therefore counterintuitive that estate agents who handle relatively little cash are regulated, but letting agents who handle lots of cash are not.”

Labour has conceded that part of the problem lies in the fact that the levels of social housing have still not increased from when they were last in power, and as a result, more and more people are forced to turn to the private rental sector as they are unable to get on to the property ladder and into home ownership.

In the present day, the Labour Party recognises that the PRS is meeting an urgent need and will press on with finding a solution to excessive agent charges.

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