Will letting agents be able to side-step new lettings fees ban?

As government gives the go-ahead for the new Tenants Fees Bill, industry body accuses some lettings agents of planning to avoid the fees ban.

New legislation designed to ban the charging of administration fees to tenants is set to come into force on 1 June 2019.

This is designed to remove the many charges that landlords and lettings agents make in renting out a property, such as tenancy renewal fees, referencing fees, credit checks and inventory report fees.

It is estimated that an average of £272 is paid by a tenant on top of the rent and deposit.

Inventory reports

The inventory report is an essential document for any tenant, offering protection against unscrupulous landlords in respect of their deposit. It is vital that the report is fair and impartial, and prepared by a genuine third party.

Industry body, the Association of Independent Inventory Clerks (AIIC), says that inventory services are already being offered to tenants by new inventory firms, touted as being independent, but in reality owned by letting agents.

The AIIC believe that agents looking to replace income that will be lost when the new bill becomes law are setting up organisations that will be classed as third-party and therefore not be subject to the fees ban. Tenants will be asked to pay them for an ‘independent’ inventory.

AIIC allegations

Daniel Zane, chair of the AIIC, making these allegations, says that tenants should be made of aware of whether an inventory report has been drawn up “by and for the agent or landlord”.

“Unbiased, impartial inventory reports remain the most protective system in place for the tenant’s deposit and its safe return with or without deductions.

“The impartiality of these reports are crucial for the protection of tenants and their finances as it is only when carried out by an impartial third party inventory clerk that the report can back up their case against a rogue landlord.”

“We have found evidence of some agents purporting to offer independent inventory reports, when really the report is being carried out by the agent under a different name.”

Ideally, the AIIC wants independent inventory reports to become compulsory for every landlord-tenant relationship.

Zane said: “We will carry on working hard to make mandatory un-biased inventory reporting part of the official process in England.”