MPs put the new housing minister Sajid Javid’s tenant fees ban legislation under scrutiny last night, and it was proven to be lacking on several fronts.
Landlords are likely to increase their rents across the tenancy to pay the extra costs of running a tenancy, something the new law can’t stop, and that there is a substantial risk local councils will impose unjustifiably high fines on agents and landlords to finance enforcement, in the absence of government support, it was claimed.
The other key criticism made during the session was that the draft bill is likely to be self-defeating – lower fees will mean letting agents are less incentivised to help landlords run their properties professionally.
These views were all the more surprising given they came from experts from the policy end of the sector, not agents.
The two-hour long session was held by the parliamentary committee that oversees Sajid’s department, the Select Committee that oversees the newly renamed Department for Housing, Communities and Local Government.
Tenant fees ban
Headed up by MP Clive Betts plus 11 other MPs, it quizzed three experts in the field about how effective the bill will be.
These were Shelter’s Head of Policy Kate Webb, the University of York’s Centre for Housing Policy Dr Julie Rugg and Professor Ian Loveland from the City Law School.
Several debates raged during the hearing including whether the bill was legally watertight enough, whether councils will have the resources to police it (they won’t, the experts said), weaknesses in the role of the new housing tribunal, the high level of fines – remember agents and landlords face paying up to £30,000 if they are caught flouting the new law – and whether the bill will drive the quality of rented properties down as landlords seek to save money.
Shelter’s Kate Webb (pictured, left) also claimed controversially that the poorer the tenant, the higher the fees letting agents charge them, while Ian Loveland picked numerous holes in the bill’s drafting, which he suggested was not robust enough to withstand legal challenges given the huge fines involved.
The MPs also debated how letting agents should be fined – and whether it should be based on the additional fees levied on a single property illegally or whether the bill should look at their whole portfolio and then fine them accordingly.
The draft Tenants’ Fees Bill will now go to report stage before a third reading.
To add your name to petition the Government to reconsider the Tenants’ Fees Bill follow this link https://petition.parliament.uk/petitions/206569