Posted: 18 June, 2013 at 3:57 pm
Former housing minister and South Yorkshire MP John Healey MP is to introduce a Bill to stop rip-off fees for renters.
Currently, anyone can become a letting agent and some are charging hundreds of pounds in upfront costs.
Mr Healey said: “Letting agent fees have spiralled out of control, with tenants facing a bewildering and costly range of upfront fees for basic services. At a time when living standards are falling, renters are paying £100s in fees just to get a roof over their head.
“The truth is that the Wild West market of letting agents needs radical reform. This doesn’t just affect the country’s nine million renters. The current system entrenches rip-off fees, shoddy standards and a worrying lack of accountability that affects everyone, including landlords.
“The government binned Labour’s plans to take action on letting agents when they came into power, and have ducked any meaningful reform since. I’m introducing a private members’ bill into Parliament with all-party support, to bar letting and managing agents from charging upfront fees to tenants, introduce a system of accreditation with basic standards for the first time, and let local councils set up their own letting agents if they think they can do a better job.
“The scandal of high-cost, poor-service letting agents has to end.”
The ten minute rule bill – Letting Agents (Choice, Competition and Standards) Bill – will be introduced with cross-party support on 2 July. If enacted, it would:
• establish a national mandatory licensing scheme for letting and managing agents, with established standards and redress for landlords, tenants and leaseholders;
• restrict letting and management agent charges to just rent and a deposit, so that tenants and leaseholders aren’t hit by huge upfront fees;
• mandate that all tenants have a written tenancy agreement with their landlord;
• enable local authorities to administer and enforce these new powers to find the right solution for each local area; and
• empower local authorities, either alone or in partnership, to trade as letting and managing agents – encouraging competition, standards and public enterprise
• Letting agency fees are pushing renters into debt or cutting back on food and heating
• All letting agents visited by a Shelter ‘mystery shopper’ charged fees to set up a tenancy, on top of deposits and rent in advance, with the average fees charged almost £350 and some more than £700
• Shelter is now calling for an end to letting fees
Almost four million households – nine million people – live in the private rented sector and the majority are let by an agent rather than direct from the landlord.