The new Consumer Rights Act stipulates that charges displayed must include a description of each fee and the service it covers and state clearly if the charge applies to the property being let or each individual tenant.
The Association of Residential Lettings Agents (ARLA) said that it supports the view that letting agent fees should be transparent and this will help consumers understand what services they are paying for.
‘In the interests of consumer protection, we would have liked to see legislation go further than it did and continue our call to make it mandatory for letting agents to be members of a client money protection scheme,’ said David Cox, managing director of ARLA.
‘We urge the next government to review this after the general election as the schemes provide guaranteed protection to both landlords and tenants should a letting agent abscond or misuse any money they are holding for either party; such as a deposit or rent,’ he added.
However, the association, which backs the eradication of unnecessary bureaucracy and red tape, it believes that further measures outlined in the Deregulation Act will have a detrimental and unintended effect on the UK lettings market.
‘ARLA greatly welcomes the new tenancy deposit legislation contained within the Act. However, the provisions in the Act designed to prevent retaliatory evictions by landlords, creates a number of unintended consequences,’ said Cox.
‘ARLA supports the principle of legislation seeking to stop landlords from evicting tenants in response to a genuine disrepair issue. The measures will mean that protections previously afforded to compliant landlords may be eroded by dishonest tenants using the new powers to defend against legitimate possession proceedings, possibly by intentionally causing damage to properties,’ he explained.
He pointed out that Section 44 of the new Act, relaxing the restrictions on the use of residential properties for short term lettings in London, will have an adverse effect on the capital’s long established and unique communities.
‘The added ability for residential homeowners to use their properties as ‘pseudo-hotels’ will lead to a constant churn of short term tenants, eroding the foundations of existing communities. Moreover, the new measures may lead to longer term, more established tenants being forced out, an increase in anti-social behaviour, reduced security and an increased risk of crime for permanent residents. London’s success is predicated upon its varied but long established community identities, coupled with the ever growing strength of its booming lettings market,’ Cox added.
Meanwhile, the National Landlords Association (NLA) is claiming a victory for landlords in Liverpool after gaining two significant concessions from Liverpool City Council (LCC) in the run up to the launch of their city wide licensing scheme.
Although the council has refused the NLA’s request to postpone the launch of the scheme that is due to go live on 01 April, it has taken two important steps to ensure that landlords in Liverpool are not put at risk.
After pressure from the NLA the council made an offline application form available, alongside its existing online process which the NLA had warned was unlawful. The council initially stated that the fee for processing offline applications would be higher than online applications.
However, after further pressure from the NLA, the council has decided that landlords will not be charged a higher fee for processing offline applications. However, the council has yet to state what the fee will be.
‘These two concessions from LCC represent a significant victory for landlords in Liverpool. The Council has changed its original process to make it possible for landlords to apply for a licence using its offline process, and has scrapped its intention to charge a higher fee for using this route,’ said Richard Lambert, NLA chief executive officer.
‘We are still concerned that LCC’s online registration form is unlawful and places landlords at some degree of risk, so our advice remains that landlords should avoid that route at all costs and instead download an application form to be on the safe side,’ he explained.
‘The full application form was only made available last week, and we think it would be fairer to postpone the scheme’s launch to give landlords time to complete their applications. However, on the advice of our lawyers, we will not press this point further,’ he added.
