Housing Rights highlights letting fees in Response to Consumer Council’s draft Corporate Plan

Housing Rights has highlighted the charging of fees by letting agents as a key issue for consumers, in our response to the Consumer Council’s consultation on its Draft Forward Work Programme 2016-17 and Corporate Plan 2016-2021.

In the Department for Social Development’s recent discussion paper on the ‘Review of the Role and Regulation of the Private Rented Sector’, they acknowledged the ‘serious concern’ of fee and premium charging by letting agents in Northern Ireland. Research by Housing Rights and the Private Tenants’ Forum has illustrated the scale of this issue. A “mystery shopping” exercise in 2013 found the practice of fee-charging was widespread; the majority of 40 letting agents contacted charged fees, ranging from £25 to £100, with the typical fee being £47.69. These fees are generally intended to cover routine services such as credit checks or administration, and generally were not advertised on agents’ websites.

Letting fees may be illegal

Such charges add significant affordability barriers to prospective tenants, who already face rising rents and deposit requirements when attempting to secure a tenancy. Housing Rights believes that the practice of charging letting fees may actually be illegal, under Article 3 of the Commission on Disposals of Land (Northern Ireland) Order 1986:

“any stipulation which has the effect, on a disposal of land, of obliging the person acquiring the land to pay commission (including fees, charges, disbursements, expenses and remuneration) due to an agent acting for the person disposing of the land, is void by virtue of this Order. In addition, in relation to lettings of land, any stipulation which has the effect of obliging the tenant to pay commission due to an agent acting for the landlord in connection with rent reviews or rent renewals/extensions is void by virtue of this Order. Money paid by a person under a stipulation which is void by virtue of this Order, is recoverable by that person.”

Housing Rights therefore encourages the Consumer Council, in their work on behalf of consumers in Northern Ireland, to consider appropriate and effective action to combat the practice of fee-charging by letting agents in Northern Ireland in their Corporate Plan and Forward Work Programme.

Further reading on letting fees in Northern Ireland

• Housing Rights’ Policy Briefing on Letting Fees in Northern Ireland;
• Housing Rights’ and the Private Tenants’ Forum research paper, The Hidden Costs of Private Renting in Northern Ireland.