Labour Party Bid to Ban Letting Fees Fails

The Labour Party has failed in an attempt to ban letting agents from charging fees to private rented tenants.

MPs defeated by 53 votes the party’s amendment to the Consumer Rights Bill to ban letting agent fees. Only three Conservative and Lib Dem MPs supported the opposition move however five Northern Ireland MPs were in support of the amendment (Mark Durkan, Lady Herman, Naomi Long, Ian Paisley and Jim Shannon).

The UK Government has however introduced its own amendment which will force letting agents in England to publish details of all upfront fees or face prosecution. This will be added to the bill at a later date.

Nick Clegg MP, Deputy Prime Minister said that the new obligations on agents to publish their fees will allow people to ‘shop around and get the best deal available’. The charges will be displayed prominently in the offices of letting agents and on their websites, with a fine for non-compliance. He also said that the government was hoping to publish this summer a model tenancy agreement which will ‘support tenants and families who wish to seek a longer, fixed-term tenancy’.

Following the vote, the UK Housing Minster, Kris Hopkins MP also stated: ‘The vast majority of letting agents provide a good service to tenants and landlords. But we are determined to tackle the minority of rogue agents who offer a poor service. Ensuring full transparency and banning hidden fees is the best approach, giving consumers the information they want and supporting good letting agents.’

The situation in Northern Ireland

According to Peter O’Neill, HRS Policy & Participation Officer:

‘A number of MLAs have expressed concern to us about the practice of local agents charging upfront fees, but the Northern Ireland Assembly has yet to examine the problem fully. In Scotland for example, the practice is illegal and in England there is new legislation which will require all letting and managing agents to belong to an approved redress scheme. An undercover survey of letting agents which we carried out last year found that local renters are being asked to pay letting fees of up to £100 on top of the usual security deposit and rent in advance. This can be a major barrier for people in financial stress who may have to borrow money to cover their first month’s rent and security deposit.  The survey found that it can cost as much as £1,430 for a tenant to move into rented accommodation. We hope the Assembly will consider this important issue in the near future and ensure that local tenants can benefit from similar protections found elsewhere in the UK.’