Stand by for fees ban confusion - trade bodies speak out

The Association of Residential Letting Agents and the National Landlords Association have spoken out about the complexity of the fees ban being introduced at the end of this week in Wales.

The ban is contained in the Renting Homes (Fees etc) Wales Act, which comes into force on Sunday September 1.

“It’s a complex piece of legislation and Fixed Penalty Notices of up to £1,000 will be issued against anyone charging banned payments. Therefore it’s crucial for agents to ensure they are well prepared and have implemented the necessary changes within their business” says David Cox, chief executive of ARLA Propertymark.

He is urging agents to use the association’s fees toolkit - available online - which includes fact sheets, legal documents and fee schedules to help explain the ban.

Meanwhile the National Landlords Association is warning that there is likely to be widespread confusion in Wales as a result of the measure, at least at first.

The NLA says that while the Act outlines the types of payments landlords and agents will still be permitted to make, it does not include a fees structure detailing any caps. 

These will come under secondary legislation the Welsh Government hopes to have completed by late 2019 - meaning that from Sunday landlords and letting agents will only be able to charge for rent, a security deposit, a holding deposit, payments in default, payments in respect of council tax and utilities, and payments in respect of a TV licence and communication service. 

But the NLA says that landlords and letting agents can use their current arrangements for these fees until the secondary legislation comes into effect. 

It believes this is likely to create confusion amongst tenants, landlords and agents when creating new tenancies. 

“To introduce half the Act now and the other half at some later date is a shoddy piece of work. All of those affected by the Act will have followed the implementation of the Tenant Fees Act in England, which introduced a fee structure and caps at the same time as reducing the number of permitted fees” explains Richard Lambert, the NLA chief executive.

“The Welsh Government needs to ensure they communicate the differences between this Act and the Tenant Fees Act in England clearly, and work on the secondary legislation as quickly as possible to clear up this uncertainty. 

“Landlords and letting agents are running businesses. They need to be able to plan for the future, just as tenants do.”