Letting fees: the need for improved regulations in Northern Ireland

With the DSD’s Review of the Private Rented Sector ongoing, Housing Rights has prepared a policy briefing on the need for improved regulations in the charging of letting fees in Northern Ireland.

What are letting fees?

Letting fees are additional charges imposed for services included in the routine letting and management of a property.

In 2013, a ‘mystery shopper’ exercise undertaken by the Private Tenants Forum confirmed the widespread charging of additional fees, with the majority of the 40 letting agents we investigated employing the practice.

Are letting fees legal in Northern Ireland?

Housing Rights believes that this practice, which affects both landlords and tenants, may be illegal under Article 3 of the Commission on Disposals of Land (Northern Ireland) Order 1986, which states:

“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 a 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 the person.”

Letting fees can make renting privately unaffordable

Over a third of Housing Rights casework queries relate to affordability in the private rented sector. With the latest housing figures showing a growing reliance on the sector to provide homes for people in Northern Ireland, Housing Rights believes that undue financial barriers should not be placed on current and future tenants.

How other jurisdictions treat letting fees

The practice by letting agents of charging additional fees is not unique to Northern Ireland. Elsewhere however, action has been taken to provide tenants and landlords with protection against this practice.

Housing Rights’ briefing paper examines the measures taken in Scotland, England and Wales and the Republic of Ireland, before arguing that letting fees in Northern Ireland should either be banned outright, or at the very least subject to greater transparency and regulation. 

Download our full briefing paper on letting fees in Northern Ireland.