Tenant Fee Ban
As you will have heard on the news, there are quite a lot of legislation changes being brought into the rental sector in the near future, and we are here to ensure that any tenancies are kept up to date.
The Bill will ban tenants from being charged for an accompanied viewing, receiving an inventory, signing a contract, or renewing a tenancy. It will allow letting agents and landlords to only charge fees relating to rent, security deposits, holding deposits, or when a tenant breaches a contract.
As a landlord, now could be the time to start looking for other properties to build up a portfolio and PFK are happy to help. There could be some properties coming to the market as private landlords struggle with the new regulations. However, dealing with the complicated business of renting is exactly what we do.
Here are a few pointers to help your tenancies in the coming months:
1. Existing tenancies are not affected by the ban until 1 June 2020. After this date any fee taken will be a Prohibited Payment.
2. Deposits are to be capped at the maximum of 5 weeks rent (unless the annual rent is over £50,000, in which case it is capped at 6 weeks).
3. You may not charge a tenant for a missed contractor’s visit, even if it is the tenant’s error. You would have to pay the costs and then, where there have been appropriate clauses in the agreement, claim from the deposit at a later date.
4. Should you try to charge the tenant a Prohibited Payment, the first breach is a £5,000 fine, and a further breach within 5 years can be up to £30,000.
This is a very brief overview of the Tenant Fee Ban; more information can be found on the Government website.
The Bill will ban tenants from being charged for an accompanied viewing, receiving an inventory, signing a contract, or renewing a tenancy. It will allow letting agents and landlords to only charge fees relating to rent, security deposits, holding deposits, or when a tenant breaches a contract.
As a landlord, now could be the time to start looking for other properties to build up a portfolio and PFK are happy to help. There could be some properties coming to the market as private landlords struggle with the new regulations. However, dealing with the complicated business of renting is exactly what we do.
Here are a few pointers to help your tenancies in the coming months:
1. Existing tenancies are not affected by the ban until 1 June 2020. After this date any fee taken will be a Prohibited Payment.
2. Deposits are to be capped at the maximum of 5 weeks rent (unless the annual rent is over £50,000, in which case it is capped at 6 weeks).
3. You may not charge a tenant for a missed contractor’s visit, even if it is the tenant’s error. You would have to pay the costs and then, where there have been appropriate clauses in the agreement, claim from the deposit at a later date.
4. Should you try to charge the tenant a Prohibited Payment, the first breach is a £5,000 fine, and a further breach within 5 years can be up to £30,000.
This is a very brief overview of the Tenant Fee Ban; more information can be found on the Government website.
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