As part of the Tenant Fees Act 2019 which came into force on the 1st June 2019, it is now illegal for letting agents and landlords to charge most fees to tenants and applicants looking to rent a property.
This is now part of UK legislation & law brought in by the Ministry of Housing, Communities & Local Government, more details can be found on the Gov.uk website here. If you are looking to rent a property you should be aware of the new rules which affect you and avoid renting from any agents or landlords trying to circumvent the changes.
Understandably there is quite a lot of confusion surrounding the tenant fee ban, in this article, we aim to clear this up for both new and existing tenancies.
For new tenancies signed on or after 1st June 2019
What you can still be charged for:
|Rent, utilities, council tax, and TV licence
Even under the tenant fee ban you are of course expected to pay your rent and household bills.
|A holding deposit
This is a fee of one week’s rent paid to reserve a property.
|A security deposit
Five weeks’ rent. This covers damages or defaults on the part of the tenant during the tenancy. Per Tenancy with rent under £50,000 per year.
|Default fees e.g. charges for replacement keys or for late payment of rent
Tenants are liable to the actual cost of replacing any lost keys or other security devices.
For unpaid rent Interest at 3% above the Bank of England Base Rate from Rent Due Date until paid in order to pursue non-payment of rent. Please Note: This will not be levied until the rent is more than 14 days in arrears.
|Fees for changing a tenant or ending a tenancy early
Variation of Contract (Tenant’s Request) £50 (inc. VAT) per agreed variation. To cover the costs associated with taking the landlord’s instructions as well as the preparation and execution of new legal documents.
Change of Sharer (Tenant’s Request with Landlord Approval) £50 (inc. VAT) per replacement tenant or any reasonable costs incurred if higher. To cover the costs associated with taking landlord’s instructions, new tenant referencing and Right-to-Rent checks, deposit registration as well as the preparation and execution of new legal documents.
Early Termination (Tenant’s Request with Landlord Approval) Should the tenant wish to leave their contract early; they shall be liable to the landlord’s costs in re-letting the property as well as all rent due under the tenancy until the start date of the replacement tenancy. These costs will be no more than the maximum amount of rent outstanding on the tenancy.
What you can’t be charged for under the tenant fee ban:
|Set up fees|
|Permitted occupier fees|
|Right to rent fees|
|Contract negotiation fees|
|Saturday move-in fees|
|End of tenancy fees
Please note deductions from your security deposit are still allowed to cover cleaning or other maintenance costs at the end of your tenancy if they are required.
The differences between new and existing tenancies
While agents and landlords can’t charge fees to tenants on new tenancies starting after 1st June 2019, they are allowed to charge fees on pre-existing tenancies until 31st May 2020.
The fee ban applies to Assured Shorthold Tenancies (ASTs). If your tenancy renews and a new contract is signed after 1 June 2019, then agents and landlords can’t charge any further fees and must repay your check-out fee if this was taken at the start of the tenancy.
However, if the tenancy continues after the end of the fixed term (what is known as a “periodic tenancy”) then your agent or landlord can continue charging fees until 31 May 2020 when they fall due under the terms of your tenancy agreement.
More information on the tenant fee ban can be found on the ARLA Propertymark website here.
Details on our charges for tenants on new and existing tenancies can be found here.