5 September 2018
The Tenant Fees Bill completed its passage through the House of Commons with minor amendments. The Bill was moved on to the legislative stages in the House of Lords the following day.

2 May 2018
The Tenant Fees Bill was introduced to Parliament by Housing Secretary, James Brokenshire MP. The Government also issued their official response to the HCLG Select Committee report on the draft Tenant Fees Bill. 

1 November 2017
The Government introduced a draft Tenant Fees Bill to Parliament to ban letting fees for tenants. The Government’s intention to do this was announced 21 June 2017 in the Queen’s Speech at the state opening of Parliament.

7 April 2017
The Government launched an eight-week consultation seeking views on the detail of how a ban should be introduced. The consultation closed 2 June and 4,724 responses were received from a range of individuals and representative bodies. The responses to the consultation have informed the Government’s approach and publishing the Bill in a draft will ensure that there is scrutiny of the Government’s proposals by parliamentarians and stakeholders before introducing legislation.

Tenant Fees Bill

The Tenant Fees Bill sets out the government’s approach to banning letting fees for tenants. The key measures of the bill include:

  • Security deposits must not exceed the equivalent of six weeks' rent.
  • Holding deposits will be capped at no more than one week’s rent. The Bill also sets out the proposed requirements on landlords and agents to return a holding deposit to a tenant
  • The amount that can be charged for a change to tenancy will be capped at £50 unless the landlord demonstrates that greater costs were incurred
  • A fine of £5,000 for an initial breach of the ban with a criminal offence where a person has been fined or convicted of the same offence within the last 5 years. Financial penalties of up to £30,000 can be issued as an alternative to prosecution
  • Trading Standards will enforce the ban and will make provisions for tenants to be able to recover unlawfully charged fees via the First-tier Tribunal
  • Landlords are prevented from recovering possession of their property via the section 21 until they have repaid any unlawfully charged fees
  • Enabling the appointment of a lead enforcement authority in the lettings sector
  • The Consumer Rights Act 2015 will be amended to specify that the letting agent transparency requirements should apply to property portals such as Rightmove and Zoopla
  • Local authorities will be able to ring-fence any money raised for future local housing enforcement

Alongside rent and deposits, agents and landlords will only be permitted to charge tenants fees associated with:

  • A change or early termination of a tenancy when requested by the tenant
  • Utilities, communication services and Council Tax
  • Payments arising from a default by the tenant such as replacing lost keys.

Commenting on the publication of the draft Tenants Fees Bill

“The day we have been expecting since the Chancellor announced the ban on tenant fees in the Autumn Statement 2016 has arrived, with the Tenant Fees Bill beginning its passage through Parliament this afternoon.

“We do not believe the Bill will achieve its aims, as our own research last year demonstrated that tenants will end up worse off and banning fees will not result in a more affordable private rented sector.

“ARLA Propertymark has worked hard over the last 18 months to explain the unintended consequences of the ban to Government, and we’re pleased they have listened and allowed Change of Sharer, Surrender of Tenancy, holding deposits, exempted the Green Deal Charge, and capped security deposits at six weeks, rather than the Committee’s proposed five-week cap. Now that we have greater clarity on what the ban will entail, agents must start preparing for when it comes into force.”

DAVID COX
Chief Executive, ARLA Propertymark

Support Our Campaign

We are in the very early stages of the legislative process. Things can change during the passage of a bill through Parliament and it is now more important than ever that those making the decisions in Westminster understand the implications of their choices. 

Now is the time for agents to see their MPs and explain the vital services they provide for the fees that they charge.

Visit the campaign page 

Our Position

Our research shows that the average fee charged by an ARLA Propertymark Protected agent is £202 per tenant. We think is fair, reasonable and far from exploitative for the services tenants receive including completing various critical checks on tenants before letting a property. We believe that the ban on fees will involve passing the costs on to landlords. Who will then look to recoup these costs elsewhere; inevitably through higher rents.

It will have a drastic impact on many people and businesses and to announce it without consultation or clarity is wrong. We do not support the banning of letting agents charging fees to tenants. We believe fees should be open, transparent and reasonable. They represent legitimate costs to the business that need to be covered. Read our proposal...

Commenting after the Autumn Statement announcement

“A ban on letting agent fees is a draconian measure, and will have a profoundly negative impact on the rental market. It will be the fourth assault on the sector in just over a year, and do little to help cash poor renters save enough to get on the housing ladder. This decision is a crowd-pleaser, which will not help renters in the long-term. All of the implications need to be taken into account.”

David Cox, ARLA Propertymark Chief Executive

Economic Impact of the Proposed Ban on Letting Agents Fees

As part of our Tenant Fees campaign, we commissioned evidence on the likely economic impact of the ban from leading consultancy Capital Economics. The research shows that the residential lettings sector turns over around £4billion per year and employs some 58,000 workers. Fees charged to tenants generate around £700 million per year or approximately 20% of the industry's turnover.

Capital Economics predicts that in the event of an outright ban agents stand to lose £200 million in turnover and a staggering 3,000 jobs could be lost.

Read more

Boards

The Consultation

The Government announced on 23 November at the 2016 Autumn Statement that it would consult on introducing a ban on letting agent fees paid by tenants, to improve competition in the private rental market and give renters greater clarity and control over what they will pay.

The Ministry for Housing, Communities and Local Government have now published a summary of responses and its response to the consultation on banning letting fees paid by tenants in England.

ARLA Propertymark responded to the consultation. 

Read our consultation response

The Government have listened to our call and increased maximum security deposits from four to six weeks and are encouraged that it appears those tenants who wish to break their contract will have to cover the legitimate costs of finding a new tenant.     

What have we been doing for Members?

Getting Members' Views Heard

After the announcement on 23 November 2016, ARLA Propertymark Chief Executive, David Cox spoke to the media to make sure members' point of view was being heard. On the day of the announcement, he held six national news interviews including BBC Radio 4’s Today programme and BBC 5 Live. We also wrote to the Chancellor and the Housing Minister to explain the importance of talking in person to discuss how the ban will impact the industry.

We are continuing to discuss the proposal to ban letting agent fees with Government Ministers and officials. We, along with many members, are also continuing to meet MPs to explain the effects that the ban will have on the industry.

Gathering evidence

Following the announcement, we asked for members feedback. Since then we have received hundreds of emails from members giving their views on how the ban will affect the industry.

Then as part of our monthly survey, we gathered actual facts and figures from members to reinforce the anecdotal evidence we have received by email. To read a copy of our findings please check our housing research page.   

This evidence is crucial to forming a comprehensive argument for the industry.

Giving Evidence

The Communities and Local Government Committee (made up of MPs in the House of Commons) opened an inquiry in November 2017 into the Draft Tenant Fees Bill. The Committee is conducting pre-legislative scrutiny of the Government's proposals.

On 29 January 2018, ARLA Propertymark Chief Executive, David Cox gave oral evidence in a Communities and Local Government Committee meeting discussing the Private Rented Sector and the Draft Tenant Fees Bill