Key organisations urge landlords to check they are compliant with the Tenant Fees Act which applies to all tenancies regardless of their start date from midnight on the 1st June.
Landlords and agents are being reminded that the year-long transition period that the government gave them to prepare for the tenant fees ban ends on Monday, and that they should check carefully that they are compliant.
The fees ban legislation went live on 1st June last year, but only applied to tenancies started after that date, and renewals. But from next week onwards it will also apply to all tenancies, regardless of when they started.
Landlords and their agents will not be able to charge any of their tenants prohibited fees including for check-ins and check-outs, referencing, viewings, inventories, securing guarantors and property cleaning.
David Cox, Chief Executive of ARLA Propertymark, warns that any prohibited ‘advance fees’ that were charged before the fees ban and were carried through until now must be returned.
“The prime example of this is an advance check-out fee which will become a prohibited payment on Monday and will have to be returned whether the tenancy is ending or not,” he says.
The only fees that can be charged are the rent, a deposit of no more than five weeks’ rent, a holding deposit of one week’s rent and up to £50 to vary a contract.
Other permitted fees include the costs of replacing a lost key, charges for the early termination of a contract, utilities and council tax costs (if charged separately for), and fees for late payment of rent albeit only after the payment has been outstanding for 14 days or more.
“Whilst most letting agents have stopped charging fees to tenants and we have received relatively few complaints to the Property
Redress Scheme (PRS) about this, now the ban applies to retrospective tenancies, if agents and landlords are not up to speed with the changes they risk penal sanctions under the law,” says Sean Hooker, Head of Redress at the PRS.
“This include a £5,000 fine rising to £30,000 and a prohibition on serving a Section 21 possession notice.
“If a complaint is received by the PRS we will automatically instruct an agent to repay the fee and may well award additional compensation to a tenant.
“This however will not exempt an agent from a local authority prosecution for the breach and we may be obliged to report an agent to NTSELAT.”