First Fees, now deposits!

Portcullis

Here we go again!

The Queen has spoken – briefly on her way to Ascot – and the news is not good.

As expected the Government has re-affirmed its commitment to ban letting agents fees to tenants in the form of the Draft Tenants’ Fees Bill. Less expected was the inclusion of two new ‘caps’:

  1. Security deposits will no longer be able to exceed the value of one month’s rent. Compared to the restriction which already applied of one sixth the annual rent (aka two months’).
  2. Holding deposits will no longer be able to exceed one week’s rent.

All in all more unnecessary regulation from a government intent on disrupting a market which works for the majority.

Is there any good news?

Perhaps not good, but neutral. As a draft bill the timetable for implementing these proposals has been stretched.

Draft bills have to undergo consultation and scrutiny in both houses of parliament, before a ‘proper’ bill is produced.

Once a bill is drafted it is then introduced into parliament and has to work its way through the various stages of the passage of a bill before finally receiving royal assent – only after which can implementation begin.

So it may be a while before we see the ban(s) come into force.

Is there anything else?

Most of the focus is understandably on delivering the UK’s exit from the EU, but agents should take note of the following (non-legislative) commitment made today to:

“look at ways we can streamline the home buying process so it is cheaper, faster and less stressful for people when they make the biggest purchase of their life”.

 

Anyone for HIPs?

This entry was posted in Blog, Fees, Politics and tagged . Bookmark the permalink.

6 Responses to First Fees, now deposits!

  1. J Blackmore says:

    In response to the last quote: How about drop stamp duty and ban mortgage application fees! Oh of course not because half of them have shares in banks or relatives that own them and the stamp duty is just a cash cow.

    • M English says:

      Yes, bring back HIPS but this time around oblige the mortgage providers to accept the survey and valuation report provided by the sellers fully qualified surveyor (naturally with mortgage providers able to sue surveyors for malpractice/incompetence in order to protect their interests). Other countries such as Australia already do this & it works very well indeed.

  2. Surely we small Letting agents charge the Tenants a reasonable fee for admin services including referencing, Tenancy Agreement, meter reads, informing utilities Company’s if new Tenants. There has to be a Cap put in fees not a total ban, say £125 max and that is the initial and long term charge (as long as the Tenant is at the premises). But no charges for renewal tenancies, check ins/outs like the big greedy Letting Agents are.
    Every other industry charges fees will definitely see DSS becoming a thing of the past in the private rented sector. Rent, bond upfront or no deal

  3. Paul Barrett says:

    Problem easy to solve
    Rent would usually be £1200pcm.
    So LL takes £2400 as the rent for the first month plus a deposit of £1200
    However the LL adds an Appendix to the AST which states that for the following 5 months and for any CPT or SPT the rent will remain at a reduced level of £1200pcm.
    At the expiry of the AST the LL returns the £1200 deposit plus £1200 rent which the LL decides to refund, job done!!!

  4. I still don’t see what government has to do with agreements made between consenting adults.

  5. Pingback: First Fees, now deposits! — UKALA – dontfeeme

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