The proposal by Labour Party to ban letting agents from charging fees to tenants was defeated in the House of Commons on Tuesday

Estate agents welcome Commons defeat on banning tenancy fees

Estate agents welcome Commons defeat on banning tenancy fees

First published in News East London and West Essex Guardian Series: Photograph of the Author by , Reporter - Waltham Forest

A director of an estate agent has labelled the Labour Party's proposal to ban tenancy fees as 'ridiculous'.

Earlier this week, a vote initiated by Ed Miliband's party to ban letting agents from charging tenants fees was defeated in the House of Commons by 281 to 228.

The proposed amendment to the Consumer Right Bill has been slammed by Jo Wilson, lettings director of Mullock Wells, based in Epping High Street as being 'profoundly anti-tenant'. 

"This ridiculous proposal was at base profoundly anti-tenant, and I’m relieved that the House of Commons has seen sense and voted against it.

"It’s a victory not only for the industry, but also for tenants themselves, who would have been lumbered with higher rents, less transparency, and a diminished rental supply as a result."

Ms Wilson explained how setting up a tenancy incurs real costs and these must be paid by either tenant or landlord.

"If the landlord had been forced to pay, the cost would simply become a hidden part of the monthly rent - which would have inevitably gone up - rather than clearly expressed as a separate fee.

"If the vote had gone through, some agents may also have been tempted to cut corners and reduce the quality of administration they provide – which is something no tenant wants," added Ms Wilson.

During Tuesdays debate in the Commons, Walthamstow MP Stella Creasy mentioned a similar ban had already been introduced in Scotland, and claimed "the experience there has been an increase in the number of letting agents and no effect on the rents people are paying".

David Cameron has said he is prepared to work with Labour on the idea of longer-tenancy agreements, a pledge at the heart of the Labour Party's local and European election campaign. 

On the same day, the coalition government announced plans to make estate agents display full details of their fees on their website and in their offices or face a hefty fine and being 'named and shamed' on the  Advertising Standards Authority (ASA) website.

Currently, the ASA only permits letting agents to list compulsory tenancy charges upfront.  

Comments (3)

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12:32pm Thu 15 May 14

villager1 says...

Of course they are thrilled with this as estate agents can carry on ripping off tenants - they charge the landlord for finding tenants and doing all the paperwork (often a wapping 10% of the annual rent) then they proceed to charge the tenant for what they have already charged the landlord for! What costs? the cost of doing credit checks and inventory (often provided by the landlord) and the cost of the assured shorthold agreement which cost pennies. They then proceed to recharge the tenant for exactly the same thing every year the tenancy is renewed. Rip off merchants; do not try to persuade us that this is in the interest of tenants, admit it is just about profiteering and lining your pockets.
Of course they are thrilled with this as estate agents can carry on ripping off tenants - they charge the landlord for finding tenants and doing all the paperwork (often a wapping 10% of the annual rent) then they proceed to charge the tenant for what they have already charged the landlord for! What costs? the cost of doing credit checks and inventory (often provided by the landlord) and the cost of the assured shorthold agreement which cost pennies. They then proceed to recharge the tenant for exactly the same thing every year the tenancy is renewed. Rip off merchants; do not try to persuade us that this is in the interest of tenants, admit it is just about profiteering and lining your pockets. villager1
  • Score: 9

3:19pm Thu 15 May 14

Sam Hain says...

Well of course they would. Turkeys don't vote for Christmas! (And fat cats always vote for cream.)
Well of course they would. Turkeys don't vote for Christmas! (And fat cats always vote for cream.) Sam Hain
  • Score: 4

9:28pm Thu 15 May 14

StanE11 says...

The cost would have been passed on to tenants anyway. This was a bad idea, the beds-in-sheds merchants would have taken no notice, their tenants are off the books.
The cost would have been passed on to tenants anyway. This was a bad idea, the beds-in-sheds merchants would have taken no notice, their tenants are off the books. StanE11
  • Score: 1

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