Letting agents across the UK have introduced additional charges for landlords following the implementation of the Renters’ Rights Act, according to industry reports and landlord associations.
The Telegraph reports that agencies are now charging separately for services previously included in standard management fees, including compliance work, financial statements, and administration related to rent increases.
New fee structures emerge
KFH now charges landlords £12 plus VAT for additional financial statements, whilst some agencies charge up to £300 for compliance audits. Agents have also introduced separate fees for completing paperwork when landlords increase rents.
The changes come as agencies adapt to increased workload under the new regulatory regime. The reforms have also affected established revenue streams, with the move away from fixed-term tenancies reducing opportunities for traditional renewal fees and commissions.
Data from Goodlord indicates that nearly a quarter of landlords surveyed reported higher agency fees since the Renters’ Rights Act took effect. The findings suggest the practice extends beyond isolated cases, with property tribunal cases rising 56% following rental reforms.
Industry response divided
The British Landlords Association has urged landlords to review their agency agreements carefully. Whilst acknowledging that reforms have increased administrative burdens, a spokesman warned against unexpected charges.
“Trying to recover increased operating costs through unexpected or questionable add-on fees risks damaging the trust between landlords and their agents,” the association stated.
Chris Norris of the National Residential Landlords Association told The Telegraph that some businesses could benefit from landlords’ compliance concerns. “Lots of landlords at the moment are fairly concerned because there are quite big, chunky sanctions attached to getting some of this stuff wrong,” he said.
Norris added that whilst some landlords may view the practice as “underhand”, others could regard additional fees as part of the cost of doing business.
Agents defend additional charges
Letting agents have defended the new fee structures, citing increased compliance requirements. Greg Tsuman, managing director of lettings at Martyn Gerrard, said: “Both agents and landlords are expected to do more paperwork to be compliant. If a landlord would like to outsource that, I think it’s perfectly reasonable that the agent charges appropriately.”
Tsuman noted that landlords face these additional costs whilst profit margins are already under pressure from regulatory changes. The development adds to challenges facing the rental sector, as landlords navigate increased compliance obligations and administrative requirements.
KFH had not responded to requests for comment at the time of publication.
