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TODAY'S OTHER NEWS

Beware: Tenant Fees ban may impact Section 21 notices

A warning has been issued to lettings agents to review tenancy agreements to see if they are fit for purpose when the fees ban takes effect in June - and in particular to minimise any impact on Section 21 notices.

The call comes from Andrew Turner, chief executive at specialist buy to let broker Commercial Trust Limited, who says that while the ban will initially apply only to renewals of tenancies and new tenancies and will exclude statutory and contractual periodic tenancies that arise after June 1 it appears the fee ban will be applicable to pre-existing tenancies from June 2020.

“From that date, any clauses in the agreement that permitted subsequently outlawed charges, will become ineffective. In the context of Section 21, this is essential information” says Turner.

“After that date, if a landlord or agent makes a charge that relates to a banned fee, they must return this within 28 days, or it will be considered unlawful and will render a Section 21 ineffective” he cautions.

“It should also be noted that the new rules only apply to assured shorthold tenancies, student accommodation and licenses.

“It is important for landlords and letting agents to fully understand the implications of the Tenant Fees Bill in the context of affected tenancy agreements and Section 21. It’s worth spending some time to review existing tenancy agreements and templates to ensure that these will remain fit for purpose after June 1 this year.”

From June 1 2019 a wide range of issues that landlords and letting agents currently charge for, will become unlawful. 

Among the fees that will be banned are:

- Charges for a guarantor form;

- Credit checking;

- Inventory checks;

- For domestic cleaning;

- For taking up references;

- Professional cleaning;

- Having the property de-flead as a condition of allowing pets in the property;

- Administration costs;

- Requirements to have specific insurance providers;

- Gardening provisions.

There are a few charges which will be exempt from the ban, namely holding deposits, rent, deposits and charges related to contractual defaults.

Turner says: “So, moving forwards, it would make sense for landlords or letting agents to ensure that future tenancy agreements do not mention any of the above banned charges. Of course there may be potential issues for tenancy agreements already in effect, which may include clauses allowing some of the above events to be chargeable.”

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    I have always thought some of the legal fees were a bit unreasonable but when it comes to cleaning et al it is the tenant that dirtied the place. They have the choice to clean up themselves or pay for someone to do it for them. If the landlord does it for them it is hardly a fee.

    Personally I think if you live in an HMO or block of flats then being dirty is showing that you have contempt for your neighbours and you deserve all you get no matter who charges you.

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    Not quite sure how professional cleaning can be considered a fee. If the property was professionally cleaned at the commencement of the tenancy then you would expect it to be professionally cleaned at the end of the tenancy. If not then this would normally be a proposed deduction from the damages deposit as opposed to a fee and if the tenant doesn't agree with it they can dispute it. The same would apply for gardening and possibly treatment for fleas. A fee would normally be a specific cost whereas cleaning, gardening etc would vary from property to property.

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    And if the tenant does not pay rent for a while the deposit is swallowed up in rent arrears and the cleaning costs would then be a .................'fee'? Don't think so somehow as this could clearly be shown as something other than said fee, it would of course be a cost with a definitive calculation of time and effort per hour at £?

     
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    A Professional Clean at a cost has to be paid for by the tenant as a charge/fee/invoice/bill or ca it something else!!!?how can it be banned. Are we the landlord expected to pay for a professional clean if the tenant has left it dirty, yet another stupid rule put in by a stupid person.

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    Oh dear you the landlord expected to do something! NEVER!
    I have always thought Landlords are tight when it comes to keeping thier properties up to scratch and for once the law is in favour of the tenant and not the rip off merchants! After all, the rent tenants pay the landlord they never get rich on and buy other properties to add to thier portfolios!!! Playing my violin for you paying for a full house clean to rent it out rather than having a empty dirty property just sitting there.

     
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    S T below should try sitting on what she is talking out of.

     
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    Sheralee Taylor, yes, if a Landlord has made sure that the property is professionally cleaned when the Tenant moves in, it should be to the same standard when they leave!
    I know one Landlord who has newer appliances in the property they rent out than in their own house.
    And also, would YOU like to move in to a house you have to thoroughly clean first? No. So why would someone else, and why should the Landlord have to pay for someone else's bad housekeeping?

     
  • Paul Smithson

    No pets in my properties in future.

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    Yes quite right Ms Taylor a good descent professional operating landlord who runs his portfolio as a profitable business in order that he can employ professionals to maintain his property to maintain its value and hopefully increase his asset value and at the same time pays tax but also providing good warm dampfree and rodent free homes for his tenant and any tenant on leaving when his contract finishes or is terminated does not leave it in a Clean and Tidy condition,as it was when they moved in and as shown in the Inventory which is handed to the tenant for sibning on Move In, will have to pay for a Professional Clean, simple good busieness logic, don't you agree?

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    Some tenants are not put in clean free from damp,rodents,heated,hot running water places so why should they pay for a cleaning service when they leave regardless of reason for leaving. In part there are shameful landlords that know how to play the system and letting agents charging fees for all sorts just to show person(s) around a property and shuffle a few bits of paper cash in. I am not against people making a living but I am against greedy people getting even more rich at the misery of others.

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    S T tenants have a choice. If it's dirty, damp, infested with rats etc, has no heating, no hot water why oh why would they move in? Please sit down so that your backside can stop talking.

     
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    Uneducated comments making blanket assumptions .. silly talk

     
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    Government is looking at any angle possible to stop landlords getting possession now .. this one is a bit far fetched shows how desperate they are

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    I can't believe that all anyone is taking about is cleaning
    To rent a £700 house in spalding will cost the new tenant Inc first months rent is £3050 it's about time this law came in it costs £7 to credit check not as much as £120 per tenant

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    So we have roughly £1,750 for the Deposit and first months rent, call it £240 (I'm assuming that is including VAT) gives us £1,990. What is the other £1,060 for? Pet deposit and Guarantor fee are the only two justifiable costs I can see there.

    And as a Letting Agent, we do more than just a bog-standard £7 credit check btw. But depending on what costs are included in the price you mentioned above, Agents like that are the problem, not the ones like myself who don't charge extra fees for everything we can dream up! For example, that £700 house you mentioned, for 2 people to rent it off me, with no pets or guarantors would be £1,990 including VAT, Deposit first rent and contributions towards the inventory and administration. Only £240 (inc vat) of that would come to me, and a chunk of that goes towards the cost of the referencing and inventory. I think I clear about £30. Hardly gouging the masses I feel!

    A cap would have been better than a ban.

     
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    Far less pets and vulnerable tenants are going to be accommodated.
    Yes there were minority of Agents charging over the odds, but there is a market place so any savvy tenant only has to shop around ( like you do for everything else )

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