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Tenant Fees Bill - what is it and how could you be affected?

Property Technology Blog


 The tenants fee ban is coming in 2019 - are you prepared? 

What is the Tenant Fees Bill? 

It has now been confirmed that the Tenant Fees Bill will come into effect on the 1st June 2019 for all tenancies signed on or after that date. The main thrust of it is that agents will no longer be able to charge a number of admin fees to tenants. 

Lettings agents and landlords will no longer be able to charge for the following:

  • Admin charges
  • Credit checks
  • Referencing
  • Charging for guarantors
  • Property inventories
  • Cleaning services when vacating the property
  • More than 5 weeks rent for full deposit (if rent is less than 50k a year)
  • Gardening services
  • More than 6 weeks rent for full deposit (if rent is more than 50k a year)
  • Renewal and exit fees
  • 1 week rent max for holding deposit
  •  De-fleaing a property where tenants had pets

What’s exempt from the ban?

  • Holding Deposits
  • Rent
  • Charges for changing tenants (£50 or as needed if higher)
  • Charges for defaults on rental contract
  • Charges for loss of keys or other security devices 


What are the penalties under the Tenant Fees Bill?

If a letting agent or landlord is found to have taken a banned fee the tenant can use the county court to get their money back. Assistance and support for this is also expected to come from local Trading Standards who will be responsible for enforcing this legislation and can issue fines of up to £5000 for a first offence. Any breaches after this could be deemed a criminal offence which will be a banning order offence under the Housing and Planning Act 2016, with the penalty being an unlimited fine or as an alternative to prosecution a fine of up to £30,000 could be imposed. So it’s worth paying attention to the rules!

How can you prepare for the Tenant Fees Bill?

In the Fixflo Report 2018, 41% of lettings agents said that loss of revenue due to external factors such as the Tenant Fees Bill will be their most significant challenge over the next year. Small agencies are expected to be hit hardest and lettings fees currently make up £0.7 million of the annual £4 billion the lettings sector makes each year so this could feel like a huge loss.

It doesn’t have to be though - it can actually be a great opportunity to update your processes and company focus. Here’s what you can do:
  • Automation is your best friend - repair and maintenance tools like Fixflo can automate certain aspects of your current employees roles, leaving them free to spend more time winning landlords and offering fantastic customer service. These will be the real differentiators in the industry going forward.
  • Think about moving your let-only landlords over to a fully managed service, if possible.
  • Focus on company culture and keeping the employees you currently have on-board - reducing staff turnover and recruitment costs.

If you want to learn about this in more detail we've got it covered: 

Learn how to navigate the tenant fee ban with one of our most popular eBooks of the year, which you can download here. 

Or we've included it as part of our 10 Tips to Avoid Risk in Your Lettings Agency which you can download for free here

And if you're wondering if there is some kind of historical precedent, you can read about what happened when Scotland passed their own tenant fees ban.

Tenant Fee Bill email banner_18-3Ebook: Tenant Fee Ban Fact Sheet  evelyn-paris-96422-unsplashBlog: The Tenant Fee Bill  Survail-EmailEbook: 10 Ways to Beat the Tenant Fee Bill




Clare Burroughs

Written by Clare Burroughs

Clare is the Marketing Manager for Fixflo

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