As from today (27th May 2015), it is a statutory duty for letting agents to fully publicise the fees they charge to both landlords and tenants. Under the Consumer Rights Act 2015, letting agents must visibly display a list of their fees at each of their offices, including their website.
These new requirements have been issued by the Department for
Communities and Local Government with some input from the Advertising
Standards Authority. The new guidelines state that, "all fees,
charges or penalties (however expressed) which are payable to the agent
by a landlord or tenant in respect of letting agency work and property
management work carried out by the agent in connection with an assured
tenancy. This includes fees, charges or penalties in connection with an
assured tenancy of a property or a property that is, has been or is
proposed to be let under an assured tenancy.”
All fees must also be inclusive of VAT. Letting agents however, do
not need to publicise the rent which is payable to a landlord or the
tenancy deposit which is taken as security against any damage or
violation of the tenancy agreement.
These guidelines are enforced by Trading Standards. Non-compliance
will result in a fine of up to £5,000. Lower fines will only be
applicable to those in extenuating circumstances. Common excuses
including, ‘I did not know about the law’ or ‘I did not know what to do,’ are no longer acceptable.
This change now means that a breakdown in costs are required. All
fees should be clear without surcharges or hidden costs. Fees for things
like 'administration fees' will no longer be acceptable, with all charges being displayed inclusive of tax.
In addition to these changes, letting agents must also display which
redress scheme they have joined. There are three redress schemes and
- The Property Ombudsman
- The Property Redress Scheme or Ombudsman Services
- Client Money Protection (CMP)
But what do you think? Start your own discussion in the LawStore Social Landlord and Tenant forum.