What Does the Tenant Fee Ban Mean For You?
If you’ve been renting in London for a few years, you would have noticed that rents have increased, alongside the average London house price rise.
According to BBC news, a 20-something professional with a typical income, spends between 30% to 55% of their monthly earnings, to rent a mid-range one-bedroom flat.
One item that isn’t usually considered at the time of signing a lease is the tenant fees. These can vary between £300, £500 up to £1,000.
Here’s some good news… all agents will soon be required, by the Chancellor of the Exchequer, to stop charging tenant fees.
You may be wondering; how will this impact you.
But first… Tenant Fees. What are they?
Tenant fees are an extra payment on top of rent and the security deposit.
It is an administration fee that agents charge to cover costs such as, credit checks, identity checks, financial checks, referee checks, preparing the tenancy agreement, tenancy extension, etc.
If Tenant Fees are Banned, Who Pays the Missing Income?
When the announcement was made to ban tenant fees, many are predicting that agents will make up for the lost income by charging landlords higher fees.
If landlords must pay more to agents, then this could be passed to the renters by raising rental prices.
The only way to not impact the landlord fees, or the rent, is for agents to be more innovative and cost-effective in how they manage properties.
Why We Have Never Charged a Tenant Fee
Since we started in 2006, we have never charged any tenant fees or contract renewal fees. Why? Because we believe tenants have enough costs to pay when looking for rental accommodation.
How do we do this?
As a web-based agency, we use innovative and cost-effective ways to manage our clients and their properties. We don’t have the high overhead costs that other agencies have.
That’s why we can easily pass the savings to landlords and tenants, and make renting as affordable as possible.
The Next Steps
Before you narrow down your search for your next rental, find out the amount of tenant fees to be charged and what is included.
Make sure you’re covered… ask the agent what will change when the banning of tenant fees comes into effect. Will the “missing” fees be passed to the renters with a rent increase?
If you’re searching for quality self-contained studios, rooms with ensuites, houses, flats and apartments for long-term letting and short stay in North, South, East and West London, then feel free contact us.
Remember, we have always passed on savings to our tenants and landlords, by never charging tenant fees or contract renewal fees.
If you want help to find the right rental property for you, and want to save money on tenant and contract fees, then call us on +44 (0) 203 286 6468 or email us at lettings@RekaProperty.co.uk.
P.S. Please share your comments below. Where do you currently live? How long have you been renting? Where do you want to live? I would love to know your experiences and thoughts on this topic