Am I still allowed to charge my tenant fees?

Question

Answer

Tenant fees are a hot topic at the moment, and there’s certainly been plenty in the news about this contentious issue.

Whether you can or can’t bill your tenant additional charges at the outset of the tenancy depends on where your property is based. If you’re located in England, Wales or Northern Ireland, you and your letting agent are legally able to charge whatever fees you see fit - landlords in Scotland however have been unable to charge fees since 2015.

However, although you may be legally able to charge your tenant fees, it is wise to consider how much is affordable for your ideal tenant, and if you will be ruling a large section of your target market out if you request sky-high fees on top of a deposit, and month’s rent up front. Do consider that your agent might be charging your tenant fees as well – and these costs can really add up.

Here at Urban.co.uk we don’t charge the tenant a penny in fees, however recent research from tenant support group Generation Rent has revealed that on average, tenants are being hit with fees of up to £813 when they take on a rental property. These high fees have led to an upcoming lettings fee ban, a bold step which has featured heavily in the election campaigns of all the major parties.

The fee ban, when introduced, will put a stop to any fees being charged by letting agents, and there is a consultation underway currently to decide whether the ban will be extended to landlords too. If this is the case, there will be no option to charge tenants any additional costs, and even the amount that you can ask to take for a deposit could be limited.

Experts are predicting various dates for the ban to be implemented, with dates ranging from November 2017 (at the Budget), April 2018 (Spring Statement) or even as far in advance of Autumn 2018. Until the consultation has been debated in more detail, there is few details that can be released, however one thing is for certain, the fees you can charge are likely to have a ticking time limit, so don’t become too reliant on them! However, currently, you can still charge reasonable fees to your tenants, upon them moving into your property.