The Tenants’ Fees Bill received Royal Assent on the 12th February and will come into effect on the 1st June 2019.
From that date, neither Landlords nor Agents will be able to charge tenants and applicants for anything other than costs reasonably incurred during the tenancy and must provide evidence to support any charges before they can be imposed. Application fees and processing costs are outlawed and any costs incurred in processing an application and granting a tenancy will have to be carried by the Landlord or Agents.
Examples of costs reasonably incurred quoted by Communities Secretary Brokenshire in the government press release suggest that charges that hitherto have been treated as reasonable may no longer be viewed as such.
Deposits are to be capped at the equivalent of five weeks’ rent.
Fees for making changes to an existing tenancy are to be capped at £50.
Breaches of the provisions will incur fines.
Restrictions are to be placed on a Landlord’s ability to recover possession of property through section 21 notices if unlawful fees have not been repaid.
Tenants can apply for refunds of 12 months’ rent if Landlords do not deal with health and safety hazards in rented property
Local authorities will be empowered to retain any funds gathered from penalties, to be used for future housing enforcement, thus giving councils an incentive and the means to apply the new legislation.
Landlords have a brief opportunity to ensure that their properties are in order and to make arrangements to cater for the new regime. Agents have to consider how to deal with projected increases in costs resulting from the fee ban and Landlords are recommended to discuss proposals with agents.