Tenant fee ban

Newark and Southwell estate agent and letting agent, Alasdair Morrison comments on the Tenant Fee Ban being introduced in June 2019.

He says:

“Legislation now prevents letting agents from charging tenants a fee to process their application to rent a property. 

“In the past, the requirement on many prospective tenants to support their application with a payment, known as the Tenant fee, which was typically £100-£300. The payment of this fee ensured that only the most committed, able and willing tenants applied, and the cost to administer such application was borne by the tenant. 

“Now this fee has been removed, anyone can potentially ‘try their luck’ in applying for a tenancy, irrespective of their credit status, because it costs them nothing. Yet these tenants still have to be credit checked and previous tenancy histories investigated, but this time at the cost of the letting agent, and, ultimately, the landlord.”

Alasdair continues: 

“It could even be that cost-cutting letting agents might even let their referencing standards slip, with potentially dire consequences for unsuspecting landlords. 

“However, the good news is that this is likely to lead to longer tenancies being established. This is because if letting agents can no longer charge tenants a processing fee, then they are more likely to want to avoid the headaches associated with such applications. 

“We have always taken pride on the duration of our tenancies in Newark and Southwell. Longer tenancies are good all round for the following reasons:

• A tenant who stays longer is likely to regard the property as their home, not just a temporary arrangement. They’ll take more care and are more likely to treat it well, making improvements (with the landlord’s consent) and are also less likely to get into arrears.
• Fewer tenants moving in and out means less wear and tear on the property, and less redecoration/carpet cleaning etc with each new tenant. 
• Renewal fees charged by letting agents are usually lower than a tenant-finding service so long-term tenancies cost landlords less. 

“When landlords are comparing letting/management companies, we’d advise doing some research and finding out the relative average length of tenure between agencies, as well as arrears and eviction rates, void periods and of course, average yield so that you can be sure your agent is maximising your investment.”

Alasdair finishes:

“Please feel free to call us at Alasdair Morrison & Partners on 01636 670977 if you would like to discuss the Tenant Fee Ban further or come along to one of our free Landlord Open Afternoons being held at our Newark office on Kirkgate. We’d be delighted to see you there.”

Alasdair Morrison & Partners – Landlord Open Afternoons

Tuesday 9^th April, 2pm-5pm

Thursday 25^th April, 2pm-5pm 

Wednesday 15^th May, 2pm-5pm