Government Discusses Letting Agent Fees in Lords


The Government has responded to a question asked in the House of Lords on the action it plans to take to prevent excessive letting agent fees being charged to private-sector tenants.

The Government’s representative in the Lords,  Baroness Williams of Trafford, claims that it has acted to protect tenants against unfair and excessive letting agency fees by requiring agents to publish a full breakdown of all charges prominently in their offices and on their website. Furthermore, a fine of up to £5,000 may be imposed against agent who fail to comply.

According to the Government, transparency rather than regulation is the most important factor in enabling tenants to make informed decisions and compare prices.  Baroness Williams claims that such measures are adequate to facilitate competition in the letting industry which would minimize prices and keep them fair.

Some however believe that such statements often ignore significant power disparities between letting agents and prospective tenants, especially in areas of high economic activity such as London. The National Renters Alliance for example believes that in some towns and cities where letting and management agencies predominate over private landlords, referencing requirements preclude the establishment of a free market system in letting agency fees.

Multiple reports exist of prospective tenants being deliberately failed reference checks by letting agents in order to charge extra reference fees.  Some have also argued that the average price of a reference check significantly overstates the genuine cost of tenant vetting.

The topic of letting agent fees is gaining increasing prominence in Parliament as the housing crisis deepens.  In 2014 the MP for Dunfermline and West Fife, Thomas Docherty, proposed a private member’s bill the “Letting Agent (Fees) Bill which would prohibit the charging to tenants by letting agents of annual tenancy renewal fees. However the motion failed to gain sufficient support.


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