The government has confirmed that it has no plan to ban letting agency fees in England.
Fees are already banned in Scotland and the government had been asked to respond to a probe into the ban’s effectiveness. The government’s response is that the evidence of any beneficial effect is “not strong enough.”
A statement from Brandon Lewis says: “My department acknowledges the [Communities and Local Government] committee's recommendation for further work to determine the likely outcome of such a ban and the approach to how this should be carried out.
“I believe that the current legislation strikes a fair balance between the rights and obligations of landlords and tenants. In the past over-regulation and excessive red tape drove many landlords out of the rental market.
“My department therefore has no plans to further regulate the private rented sector by banning letting agent fees in England, as this would only reduce the numbers of properties available to rent which would not help tenants or landlords.”
Lewis then writes that his department has recently introduced what he calls “transparency measures” for agents in the Consumer Rights Act 2015.
These require letting agents to publicise a full breakdown of fees and statements regarding client money protection and redress scheme membership prominently in their offices and on their website.
“These provisions aim to increase effective competition and allow renters and landlords the ability to compare prices and assess value for money, thereby strengthening the consumer's choice” explains Lewis.
Lewis concludes that his department will investigate the potential effects of banning letting agency fees in England “if it becomes clear that the transparency measures are not achieving their policy objective.”