Agency pays thousands for breaching Tenant Fees Act

A London-focussed lettings agency group has paid £2,000 as a result of breaching the Tenant Fees Act.

The issue relates to the Southwark headquarters of Portico Property - prior to its acquisition by the Leaders Romans Group.

The agency was penalised by Southwark council because it required a tenant to make a payment of £195, for leaving joint tenancy of a flat in Camden, at the end of its term, when other parties to the joint tenancy wished to continue.

Government guidance says that such a charge should not be more than £50. 

Agents are allowed to charge more if the amount of their reasonable costs are higher but any attempt to charge more than £50 must be backed up with evidence of these costs.

Emails sent by the company in June 2021, demanded an upfront: “outgoing/exiting tenant fee” of £195. 

However, the tenant challenged this, asking for evidence of their costs in line with the guidance, which was not provided. 

When the tenant said they were going to escalate the matter to the Property Ombudsman scheme and notify trading standards, the company reduced the fee to £50, as a “gesture of goodwill”.

Now a spokesperson for the council says: “It is disappointing that we had to take action in this case, as the guidance to agents is quite clear. Thankfully, this tenant knew their rights and refused to pay the banned £195 fee. However, it should never have been presented in the first instance.

“We are committed to improving standards in Southwark’s private rented sector. I am pleased that thanks to the work of our trading standards team, this company has been punished for breaching a law that is intended to protect tenants.”

Portico, which had 15 branches across London, has been acquired by the Leaders Romans Group and its registered office has moved to Wokingham.