Understanding the Impact of the Tenants Fee Ban on Landlords and Agents
The Tenants Fees Act bans all fees from letting agents and landlords to tenants, impacting the rental market significantly. This article explores what can be charged to tenants, reasons for using an agent, services provided by agents, and insights from landlords on the changing landscape post-ban. Additionally, it delves into the potential increase in fees by agents, the shift in landlord-agent dynamics, and considerations for landlords in navigating these changes.
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Presentation Transcript
Do I need an Agent? Impact of Tenants Fee Ban. www.landlords.org.uk 1
Tenants Fees Act Bans all fees from letting agents and landlords to tenants. Will be implemented Sat 1 June 2019 Tenancies signed before will have a transition period to the 1stJune 2020 before being subject to the ban. www.landlords.org.uk Gives exemptions for payments arising because of 2
What can be charged to the tenant? Rent & utilities Rent Arrears 3% above BOE interest rate (applies after 14+ days late) Holding Fee 1 weeks rent held for a period of 14 days Replacement tenant (mid tenancy) 50.00 (including VAT) Lost Keys or security devices 5 Weeks Deposit 6 weeks if rent is 50k+ a year Surrender of tenancy Tenant pays the remainder of rent www.landlords.org.uk 3
What do you tell us? 60% of landlords use an Agent Letting Fees are a landlord s 3rdlargest cost 80% think their letting agent will increase fees 40% of landlords intend to increase the rents 22% hope to shop around for a better deal. Nearly 10% plan to stop using a letting agent Source NLA Quarterly Member Surveys www.landlords.org.uk 4
What an agent does Four main types of services 1. Letting Only 2. Letting and Rent Collection 3. Full Management 4. A Rent to Rent Contract An agent rents the property from the landlord and then sublets it to tenants that they find. www.landlords.org.uk 5
What an Agent does Letting only most common amongst members Valuation advises on achievable rent levels Marketing take promotional photos and property details Finds Tenants advertises, conducts viewings Deals with initial paperwork and legalities to initiate tenancy e.g. Reference Checks, Inventory & Tenancy Agreement www.landlords.org.uk 6
Reasons for using an agent You don t have the time or want the hassle/stress If you re not confident in your property management skills, or your knowledge of legal requirements You live too far away from the property You own a large HMO (or other property) which has a high turnover of tenants or requires more intensive management. www.landlords.org.uk Fees are tax deductible 7
However Know YOUR responsibilities - it is ALWAYS the Landlords responsibility for ensuring legal obligations are met! Actions carried out by the agent on your behalf are treated in law as if they had been done by you, the landlord. www.landlords.org.uk 8
Other reasons to think twice Very competitive market now esp. online Weigh up cost of your time and you confidence / knowledge Traditionally fees charged between 5-20% of rent BIG SAVINGS can be made if you can / are prepared to put time and effort in www.landlords.org.uk 9
Going it alone: how & how much Advertising and marketing can be free = e.g. Open Rent www.openrent.co.uk Other online agents charge from 50 + NLA Tenant Check from 8.95 (other services available) NLA Inventory circa 150+ (costs depending on service and property e.g. no. or rooms) www.landlords.org.uk 75 NLA membership - forms / advice etc 10
Questions to ask your agent Are you a member of a professional body, (NALS or ARLA) Do you have client money protection? How do you find tenants & how thorough is your referencing process? Can you have a full list of services and charges on one page? www.landlords.org.uk Copies of all documentation 11
Introduction to Lettings Course NEW NLA half-day training course Getting ready to let Not falling foul of the law Using an Agent or Self Management Signposting to who can help you Next one is 30 April in Southampton www.landlords.org.uk 12
Thank You Teresa Kaczmarek: Area Representative NLA Teresa.Kaczmarek@landlords.org.uk Linda Cobb: Manager, Decent and Safe Homes (DASH) Linda.cobb@derby.gov.uk www.landlords.org.uk 13
