Yeehlow

The moment has come: starting on June 1st, 2019 the UK Governmnet has officially enforced the Tenant Fees Act, a regulation aimed at banning letting fees paid by tenants in the private rented sector and at capping tenancy deposits in England. 

This decision will probably lead to tangible consequences both for tenants and landlords. Yeehlow’s team studied the new regulation for you, and we prepared a list with the 10 main differences you could face.

• Who and when

The new Tenant Fees Act will apply immediately to all tenancy agreements signed after 1st June 2019. It will then be enforced on pre-existing contracts starting on 1st June, 2020. This allows existing landlords to settle and adapt to the new legislation.

• A cap on starting or renewing a tenancy…

Starting from June 2019 the amount that can be charged for starting or renewing a tenancy will be capped at £50, unless the landlord can prove that he/she incurred in greater costs during the procedure.

• …On deposits…

With the new Act tenants’ security deposits will be capped at five weeks’ rent for tenancies under £50.000 per year and at six weeks’ rent for larger amounts. Furthermore, the so called “holding” deposit — the payment made by a tenant to reserve a property — must not exceed one week’s rent and it must be be fully refunded to tenants within seven days of the end of the tenancy, or within 15 days of taking it if the agreement is not completed for any reason.

• …And on contract changes

Contract changes’ expenses will be capped as well at a maximum amount of £50. Any agents who is willing to charge more than this will have to show proof of the reasons behind higher prices.

• Tenants won’t be charged for references…

With the new regulation letting agents won’t charge tenants for credit checks, references, insurances or similar practices. Such costs will have to be covered by the landlords.

• …Or for property viewings

Letting agents won’t be allowed anymore to charge potential tenants for viewing or visiting a property for the first time.

• No tricks allowed!

Green Away Residential states that the rent has to be the same amount for the tenancy agreement.  It is prohibited to have a higher rent in the first month to reclaim lost fees.

• Agents who don’t comply can be fined

Letting agents who refuse to comply with the new Tenant Fees Ban’s dispositions can face a fine of up to £5.000

• Landlords’ rights: what can they charge?

Landlords will still be able to charge their tenants with fees related with utilities, taxes, communication services, changes or sudden terminations of contracts and late payments.