Regulation and Enforcement

May: We need a fee ban that works

Sally Walmsley
Written by Sally Walmsley

Prime Minister Theresa May said the government will concentrate on creating a letting agents fee ban that ‘actually works’ – however she would not be drawn on a timescale.

During Prime Minister’s Questions yesterday, Alex Cunningham MP (Labour, Stockton North) asked about the plan. He told the House:

“My young constituent paid a £300 house-reservation fee to Pattinson estate agents, but the agents will not refund it after their landlord client withdrew from the contract because my constituent refused to pay 12 months’ rent in advance.

“She faces having to pay another agent non-refundable fees of £650 to secure a different property.

“When will the Prime Minister act to put an end to these rip-off fees and stop these agents capitalising on young people and others?”

The Prime Minister directed Mr Cunningham to the Queen’s Speech which, she said, “referred to what we are doing in this area.”

Interrupted by Mr Cunningham asking “when?” she continued:“He will recognise that in this House we need to ensure that we get right any legislation that we introduce, so that it actually works.

“We recognise the problem and we are going to do something about it.”

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.

2 Comments

  • Ban rip off fees but don’t ban genuine payments for work done to already beleaguered agents and landlords.

  • An unusual and unclear case. To quote the old legal maxim: “Hard cases make bad law”.
    Was this young lady made aware that the landlord wanted 12 months up front?
    Were all the other details regarding the non-refundable fee clearly stated on the documents which were signed that day?
    Having a clearly explained, non-refundable holding deposit, which would include the admin fee, ensures that our applicants thoroughly consider their decision. As an agent, when we inform our landlord that someone has put down the deposit on their property, we want to be certain that the applicant is committed to the process of reference checks, and to the tenancy.
    I can’t help but feel as though this ban is like using a sledgehammer to crack a nut. Certainly, there are agents out there who spoil the image of the profession, and bad practise needs to be prevented. We would welcome clearer rules regarding holding deposits and admin fees, because it would let everyone know where they stand. Outright bans will simply push up landlords’ fees, and in turn, rents. The other option is for prospective tenants to arrange their own credit/referencing checks to be carried through relevant companies, which would also cost them money.
    I can see that the government means well, but this is just clumsy.

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