Tenants Fee Bill hits Parliament - it's getting closer!

With the ink barely dry on his new contract, James Brokenshire is seemingly getting stuck into his new role as Secretary of State for Housing, Communities and Local Government, and has published the Tenants Fee Bill into parliament today.

The introduction brings the ban on fees one step closer, a move which Mr Brokenshire claims will save tenants around £240m a year once in place, whilst costing letting agents over £151m in the first 12 months.

The key measures include:

  • Capping security deposits at no more than six weeks’ worth of rent, and holding deposits at no more that one weeks’ worth of rent
  • More robust requirements for landlords and agents to return holding deposits to tenants
  • Capping the amount that can be charged for a change of tenancy at £50 (unless the landlord can demonstrate that greater costs were incurred)
  • Preventing landlords from regaining possession of their property via Section 21 notice, unless they have repaid any fees that have been unlawfully charged to tenants.
The document also set out the potential fines that are being suggested for breaches of the legislation, which will be enforced by Trading Standards.A fine of £5,000 for an initial breach is detailed. If a person has been fined or convicted of the same offence within the past five years, they could also face a criminal prosecution. In lieu of criminal prosecution, a fine of up to £30,000 could be issued.

In the same vein as money recovered through fines levied against rogue landlords, local authorities will be permitted to retain finances raised this way, with a view to ploughing the cash back into future local housing enforcement projects.

As well as charging rent and taking deposits, the document states that agents and landlords will only be permitted to charge tenants for costs associated with:

  • A change or early termination of a tenancy if the tenant is the party that instigates this change•
  • Utilities, communication services and Council Tax
  • Payments arising from a default by the tenant such as replacing lost key

It remains to be seen how the final document ends up, and there are bound to be further changes to the legislation by the time it reaches its final stages, but there’s no doubt about it, fee-ban-d-day is drawing ever closer.

This government is determined to build a housing market fit for the future. Tenants across the country should not be stung by unexpected costs. That’s why we’re delivering our promise to ban letting fees.

Secretary of State for Housing, Communities and Local Government, James Brokenshire

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