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Letting fee ban will not cut the cost of renting

Sally Walmsley
Written by Sally Walmsley

Landlords are already feeling the effects of the proposed letting agent fees ban – which is unlikely to make renting cheaper for tenants.

New research by the RLA found that more than half of letting agents questioned, 57% planned to cope with the proposed tenant fee ban by increasing the fees landlords pay.

This raises the prospect of the extra costs being passed on to tenants in higher rents over the long term.

The warning has been echoed by the Office for Budget Responsibility which has noted that: “It is possible that a ban on fees would be passed through to higher private rents. If this was the case, it could affect our housing benefit spending forecast.”

The survey finds also that one in five landlords are less likely to use a letting agent as a result of the fee ban.

Rather than a fee ban, the RLA is calling on Ministers to use the powers they already have to force agents to display more prominently the fees they charge, and specify them in greater detail.

This would make it much easier for tenants to compare fees charged by one agent compared to another.

The RLA Policy Director, David Smith, said: “Tenants are being offered false hope that banning the fees they pay will make renting cheaper.

“Rather than making changes which the Office for Budget Responsibility has warned could push up rents, Ministers could take immediate action to help tenants shop around for the best deals they can find.

“Many landlords get the education they need to manage their properties effectively themselves. However, not all landlords have the desire or time to do so.

“For all the flack they receive, the vast majority of agents play a helpful role in supporting landlords to ensure properties are safe, legal and secure.”

The research was carried out by the RLA Private renting Evidence, Analysis and Research Lab (PEARL) which provides analysis and research on the economic, social and political issues facing the sector.

About the author

Sally Walmsley

Sally Walmsley

Sally Walmsley is the Magazine and Digital Editor for the NRLA. With 20 years’ experience writing for regional and national newspapers and magazines she is responsible for editing our members' magazine 'Property', producing our articles for our news site, the weekly and monthly bulletins and editorial content for our media partners.

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