Tenant Fees Act comes into force

Tenants will be protected from unfair letting fees with most seeing tenancy deposits capped at five weeks’ rent, putting hard-earned cash back in their pockets, thanks to a new law which came into force last month (June).

Unexpected fees and high deposits can make properties harder for people to afford and are often not clearly explained upfront, leaving many prospective tenants unaware of the true costs of renting a property.

The Tenant Fees Act now puts an end to these unnecessary fees imposed by landlords and agents. It is expected to save tenants across England at least £240 million a year, or up to £70 per household.

The Act also caps the tenancy deposits that renters pay at the start of their tenancy at the equivalent of 5 weeks’ rent. This gives people the assurance that, legally, they cannot be expected to pay more than this (where the total annual rent is less than £50,000) to secure a property.

This Act also puts a stop to tenants being charged hundreds of pounds for admin or renewal fees. In addition, under the Act’s default fee provision, landlords and agents are only able to recover reasonably incurred costs from tenants for lost keys or other security devices and must provide evidence of these costs before they can impose any charges. They may also charge a default fee in relation to late rent.

The Act ensures that tenants who have been charged unfair fees can get their money back. Trading Standards or the First-tier Tribunal can require landlords and agents to pay back any prohibited payment or any unlawfully retained holding deposit within 7 to 14 days.

(Published by the Ministry of Housing, Communities & Local Government: 1 June 2019)