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Letting agent welcomes tenant fees ban as it ‘rights a flawed piece of legislation’

The government’s ban on tenant fees is good for business and will strengthen the relationship between landlords and tenants, according to one letting agent based in Scotland.

DJ Alexander Ltd, one of the largest family-run property management businesses north of the border, believes that charging tenants administration fees is both unnecessary and bad for business.

The company, headed up by brothers David and John Alexander, believes that the experience of the Scottish market means that Scotland could be the model for future letting in the rest of the UK.

The regulations in the forthcoming Tenants Fees Bill in England and Wales have been in place in Scotland since 2012; the no fault grounds for eviction notices no longer exist in Scotland; and the Scottish government recently introduced much greater security of tenure for tenants.

David Alexander, joint managing director of Apropos by DJ Alexander Ltd, said: “In many ways Scotland has led the way in improving the rights of tenants and changing the relationship between landlord and tenant. Too often this relationship has been confrontational and divisive with each side pitted against the other. Rather than resolve any disputes or problems the attitudes and the regulations seem to be established to dispose of any complaint by a tenant rather than address it.”

“The Tenants Fees Bill simply rights a flawed piece of legislation that allowed unwarranted and unfair charges to develop under the camouflage of ‘administration expenses’ often with little or no explanation of what these were for or why they were being applied. With many letting agents operating a business model where such charges account for a quarter to a third of income it is clear that they were not motivated to end these charges, reduce their levels, or to have them examined in too much detail.”

John Alexander believes that the ban on the fees will result in higher fees for landlords, which will concern many buy-to-let investors.

He commented: “When these charges were ended in 2012, and they were never as substantial a part of the Scottish market as they have been in England and Wales, there were doom-mongers who predicted the end of the lettings market. But this did not happen, the market adapted, landlords were charged more, but the best agents and the best landlords adapted and realised that this was fairer for the tenant and, in the long term, created a better relationship between the two.”

“Equally the ending of the no faults ground for eviction notices and introducing much greater security of tenure for tenants was feared by some in the property market as a sign of them losing control. On the contrary it gives agents, landlords and tenants the opportunity to develop a relationship built on trust, on fairness, and on developing a long-term relationship to their mutual benefit.”

Poll: Do you think the tenant fees ban is fair?

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    What ridiculous publicity garnering comments. Is it not reasonable that Tenants should pay legitimate costs, such as Reference checks !
    Agree that some Agents have been taking eye-watering sums and scr*wing tenants, but Govt shouldn't have thrown baby out with the bath water.

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    A cap on fees would have made more sense, the extra costs incurred by landlords will filter through to increased rents, so there will be no winners here .

  • Mark Wilson

    Possession Friend, you beat me to it!

  • Paul Barrett

    Afraid it is the direction of travel with the PRS.
    It seems that apart from rent and a much reduced deposit the PTB consider that is all a tenant needs to pay when taking effective ownership of a quarter of a million pound property.
    Perhaps if it were possible to get rid of rent defaulting tenants 14 days after 1st rent default as they do in Oz then LL could tolerate the fee ban!

  • Andrew McCausland

    Agreed - utter nonsense! A cap on fees would be both fair and proportionate. The government went for the option of appeasing Generation Rent rather than looking at the issues and making a rational determination of the issues at hand. Rents are rising for all as a result of this and other legislation recently introduced.

  • icon

    Look the Conservatives bought votes with the sell off of council housing under Thatcher. They realise that as the majority of their current/future voters are no longer homeowners they had to do something to buy off the next generation. Generation rent. I guess the alternative is Corbyn which would be even worse. Fair to say none of them give a fig about tenants, landlords or agents. Just themselves.

  • Paul Barrett

    Yep never before has there been such a mass transfer of taxpayers money to so many undeserving citizens.
    The RTB policy has spectactularly failed.
    This as the next generation now has a reduced pool of social housing to choose from. Is now forced to use the PRS which is not there as a social housing provider due to the profit motive which is the reason most LL are in the game.
    The two needs are clearly incompatible with eachother.
    Somehow the 2 million RTB properties sold off need to be immediately restored plus building of about another 4 million over the next 10 years needs to occur.
    It matters not if loads of Labour voters are created out of social housing tenants as this is occurring now out of those who ordinarily would have bought but now can't and are forced to rent in a now ever reducing PRS as a consequence of all the bonkers anti-LL Govt policies.
    So it matters not what form of tenure is used the facts are that GR is voting Labour.
    The demographics simply don't add up for an increased Tory vote.
    Social housing construction was once a Tory philosophy.
    It needs to return to that strategy ASAP.
    Throwing money at the problem is the only way the Tories will be able to garner sufficient GR votes to enable future Tory Govts.
    Quickest way to achieve this is to buy back from LL properties that LL currently use to house HB tenants.
    Most LL will be glad to get shot of such properties.
    Offer market price with no CGT payable and Govt could pick up loads of cheap housing to become social housing but this time with RTB permanently banned.

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    Great idea Paul! First people to contact are the parents of the SNP First Minister (current female one - not her predecessor now facing various sexual harassment charges). Her parents still reside in the ex Council house they bought at a discount while she lives in a multi million town house mansion courtesy of the tax payer and National Trust.

     
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