Agents can no longer charge fees to a tenant
The tenant fee ban is firmly upon us and from 1st June 2019 the Government are enforcing a blanket Nationwide ban on agent fees. This means tenants and landlords will no longer be allowed to charge a tenant for application fees, referencing fees, inventory costs, checkout fees and many more.
It looks like that after much consultation within the industry landlord fees will have to be increased and consequently, rents will be increased. The only natural move for agents and landlords is to pass the costs on to the tenants by increasing rents.
I hope that the market won’t see many landlords selling their investments but naturally, it will be considered as their return is squeezed yet again. The Nottingham Selective Licensing meant that 10% of our properties were sold on the open market which means less stock for rental and therefore prices increasing again for tenants.
For anyone caught charging fees they will be fined £5000 for the first offence and £30,000 for any subsequence offences.
What does this mean for the industry?
I think ultimately landlords will start to shop around for agents and see if their pricing is competitive within the market. Customer service will start to become more important to investors to make sure they are getting the best value for money as at the end of the day they will be paying more.
Tenants I hope we won’t notice a difference from a day to day point of view but I am sure some agents will look at saving on costs. No viewings or move in after-hours/weekends, I do believe agents will be less flexible as whole but we sill see over the next 12-24 months.
If you have a property and your prices have increased please feel free to contact us on 0115 958 7791 or visit our office at 31 Abbey Road, Nottingham, NG2 5NG to see how we could help you and your investment.