The Tenants Fee Bill, which aims to ban the majority of charges to tenants by letting agents and landlords, has begun its journey into the upper chamber of the House of Lords.
The Bill was first introduced to Parliament in May 2018, and has since completed stages within the House of Commons, to move swiftly into the House of Lords for more scrutiny. The First Reading took place on 6th September 2018 in the House of Lords, with the next step occurring on 10th October 2018.
On 5th September 2018, the Bill succeeded through the Third Reading and Report Stage in the House of Commons, with approved minor amendments tabled by James Brokenshire MP, the Secretary for Communities and Local Government.
The amendments passed on behalf of Mr Brokenshire were made to bring legislation for landlords level with letting agents, and cleared up the intentions of the Tenants Fee Bill. These changes are:
– The Bill now directs that default payments are not a permitted payment if this type of fee is not documented within the tenancy agreement.
– Consent from the tenant is required to direct whether the prohibited payment or holding deposit should be repaid through return of the deposit or deduction of rent.
– Agents and landlords must repay prohibited payments within 7 – 14 days instead of the current 28 day period.
– To charge default fees, the agent or landlord must give proof of fair costs incurred.
Melanie Onn MP, Shadow Housing Minister, tabled more amendments which would result in agents and landlords incurring a fine of £30,000 for a first offence, with unlimited fines for further offences. Another tabled amendment from the Labour MP included the removal of default fees as permitted payments, replacing them with the payment of landlord and agent expenses in situations where a clear cost from tenant fault has occurred. However, both amendments were subsequently voted down, and the Tenants Fee Bill successful passed through the House of Commons with no opposition.
Chief Executive of the Association of Residential Letting Agents (ARLA), David Cox, worked alongside Daniel Kawczynski MP, on an amendment which would allow landlords to charge tenants fees of up to £300 when renewing or starting a tenancy. However, this amendment did not pass, as it was not voted on.
As the Tenants Fee Bill passes into the House of Lords, Mr Cox has stated that they will continue working to ensure that MPs listen to the legitimate worries of the sector, and the impact of the ban on the whole industry.