Tenant fee ban comes into effect this weekend

The Tenant Fees Act 2019, banning landlords and agents from charging fees to tenants, will come into effect on Saturday in England. 

The Act means that from 1 June 2019, landlords and agents will no longer be able to charge fees to set up or renew a tenancy in the private rented sector.

The new law will not just mean a ban on letting fees, but also the majority of other upfront fees payable by tenants to rent a property in England.

There will also be a cap on the amount of refundable security deposit a tenant would be required to pay to the value of five weeks’ rent as a tenancy deposit on annual rents below £50,000, for new and renewed tenancies - six weeks’ rent if the total annual rent is £50,000 or above. There will also be a cap on the amount of holding deposit a tenant will be required to put down to secure a property to the value of one week’s rent.

The government believes that the Bill will make renting properties in England fairer and more affordable for tenants by reducing the costs at the outset of a tenancy, at the same time as improving transparency and competition in the private rental market.

The ban on fees charged by landlords and letting agents in Wales will be introduced in September.

From 1 September 2019, agents and landlords in Wales will no longer be able to charge fees to set up, renew or continue a standard occupation contract except those explicitly permitted by the Bill.

Many landlords may not yet be familiar with standard occupation contracts, but they will replace assured shorthold tenancies when the Renting Homes (Wales) Act 2016 is introduced – possibly later this year.

The Bill means that it will be illegal for landlords and letting agents to charge anything other than permitted payments, which are: rent, security deposits, holding deposits, utilities, communication services, council tax, green deal charges and default fees.

Under the new Act, holding deposits will be restricted to one week’s rent with provisions that ensure their prompt repayment.

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