ACCORDING to the charity Citizens Advice, letting fees cost an average of £337 per person, while letting agents themselves say the figure is closer to £200. Many tenants are faced with charges over £500 in big cities like Manchester, London and Birmingham.
Tenants can be charged fees for a range of administration, including reference, credit and immigration checks.
Many agencies argue that banning fees will see rent prices go up but Scotland introduced the same legislation and it has not had a major financial impact.
A report by Shelter assessing the effect of the change in Scotland suggested that:
- Rises in rent had been “small and short-lived” despite expectations that rents would increase to cover the greater burden on landlords
- Landlords in Scotland were no more likely to have increased rents since 2012 than landlords elsewhere in the UK.
Manchester renter, Amelia Edwards, said: “Me and my boyfriend were recently looking for a flat in Manchester city centre. The fees were extortionate and I ended up having to pay £450.”
In total, she had to pay £1,300 including admin fees, deposit and the first month’s rent.
“I’m glad fees are being banned,” she said.
“I had to pay the fees out of my savings and borrow some money from my parents.”
Following Hammond’s news, agents saw some of the biggest falls in company share prices in early trading, with Foxtons down 11 per cent, Countrywide down nearly six per cent, and Savills also falling slightly.
By Lana Guy