Landlords and letting agents beware!!!
A Tenant Fees Bill has recently had its first reading at the House of Commons. The Bill imposes restrictions on landlords and letting agents of privately rented residential properties from charging their tenants with certain payments. The aim of the Bill is to ensure tenants are not forced to pay “letting fees” which are charged in relation to their tenancies. The Bill will allow for holding deposits which are payments made by the tenants to secure a property, but it will also limit the amount so that this does not exceed one week’s rent and it must be refundable. The Bill will also ensure that fees for assigning and varying tenancies are reasonable.
Landlords should note that once the Bill is enacted a breach of the ban on certain fees will be a civil offence with a financial penalty of £5,000, but if a second breach is committed within 5 years of a financial penalty or conviction, this will be a criminal offence. The penalty for the criminal offence will be an unlimited fine which local authorities may choose to impose a financial penalty of up to £30,000 as an alternative to prosecution.
A breach of the provisions of the Bill which require holding deposits to be refundable and limit the amount chargeable will be a financial penalty of £5,000.00. The Bill will be enforced by trading standards authorities and district councils.
For Commercial Property advice contact Christopher Sykes Head of Commercial Property.