Letting agents will be required to publish full details of the fees they charge under plans announced by Government ministers yesterday.
The Government says the move ensures a fair deal for landlords and tenants, closing off the opportunity for a small minority of rogue agents to impose unreasonable, hidden charges. It added that the common sense approach avoids excessive state regulation which would push up rents for tenants.
Currently, the Advertising Standards Authority only requires letting agents to list compulsory charges to the tenant upfront in the process. Those letting agents who are found to have imposed hidden charges face little more than being named and shamed on the Advertising Standards Authority's website.
But the Government wants to go further than this, and will require all letting agents to publish a full tariff of their fees - both on their websites and prominently in their offices. Anyone who does not comply with these new rules will face a fine - a much stricter penalty than currently exists.
This week's plans add to the work the Government is already doing to offer stronger protections for landlords and tenants in the private rented sector, whilst avoiding excessive regulation which would force up rents and reduce choice.
Housing minister Kris Hopkins said: The vast majority of letting agents provide a good service to tenants and landlords. But we are determined to tackle the minority of rogue agents who offer a poor service. Ensuring full transparency and banning hidden fees is the best approach, giving consumers the information they want and supporting good letting agents.
Short-term gimmicks like trying to ban any fee to tenants means higher rents by the back door. Excessive state regulation and waging war on the private rented sector would also destroy investment in new housing, push up prices and make it far harder for people to find a flat or house to rent.
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Comments
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The key issue remains that of policing. Generation Rent's Alex Hilton today claims that 30% of agents do not abide by the ASA ruling. I don't doubt he is correct, however the rules rely upon the tenant to police those who refuse to comply. Under ASA rules, the complainant is named.
No rules or regs have any traction if they aren't aggressively policed. Agents should have the option to report those competitors who refuse to play by the rules without fear of being identified as the complainant. This forms part of the concept of self regulation. It's unfair that some agents give the impression of being cheaper then spring hidden charges once an applicant has set their heart on a property they don't want to risk losing.
so even Foxtons will have to clearly publish all fees both on their websites and prominently in their offices - wow !
I'm largely pleased with the outcome. I don't particularly have a problem with publishing fees, although I agree to an extent with RedRooster.
Does anyone think this will be it though I envisage another vote in the next 6 months...
And now for the reality.
At present we do not have a full clear picture of what our local competitors charge.
With the new proposal in place, all of this data will be available. When this information is available on all web sites, we will continually look at the competitors to see what they're charging, and they will do the same.
There are three possible outcomes for this:
1 - We all continue to have different fees
2 - We all drop our fees to the lowest level
3 - We all increase our fees to the highest level
Can anyone guess the outcome
Whilst I agree that hidden fees are a disgrace, and that too many agents milk this aspect of the industry, the sad outcome of this information being made so public is that tenants will end up paying more.
Not perfect but some commonsense at last - almost a first!