Peers in the House Lords today (January 19) debated how a ban on letting fees, which impacts thousands of students in Bournemouth, will be implemented across the country.
The Chancellor, in his November Autumn Statement, revealed that lettings agents in England will be barred from charging fees to tenants “as soon as possible”.
Baroness Grender questioned the steps on how to implement the ban on administration charges. She probed how comprehensive the ban would be, and whether loopholes would remain to be exploited by estate agents.
At the beginning of a tenancy, agents can impose a fee known as the administration charge, which could be in the hundreds of pounds per renter each year.
Lucy Russell of the Bournemouth Borough Council recently stressed that there is a need for “consistency” in letting fees. She revealed that the average letting fee charges for two tenants in the area range from £40 to £600.
Bournemouth rental prices have risen by 9.1% since 2011. Local tenants said they hoped the ban would be introduced in a robust way and that there were no loopholes in the new rules.
Tenant Charlotte Bruce said that she thinks it is “terrible” that they can raise fees without a cap. “When I looked at the paperwork for my rented home, we realised that in the last three or four years the rent had nearly doubled,” she said.
Her housemate Bethan Harper added: “Letting agents take advantage of students especially, because they know we have no choice but to go through agencies to find accommodation and the prices are extortionate for students who are already struggling to pay rent and deposits let alone agencies fees as well.”
Myles Tyler, who works in the town, revealed that he was charged an administration fee of £300 for merely remaining in the same property. “I didn’t understand what they were actually charging me for. They already had my details, and it’s not like they were offering any services, whatsoever.”
However, estate agent, Ashley Reeves disagreed with the ban, arguing that instead it will end up costing the tenants more in the long run. He explained to Buzz Radio that it may “inflate their outgoings over a longer period of time”.