The National Approved Letting Scheme (NALS) has revealed that the impending letting fees ban is not expected to come into force until Spring 2019, as confirmed by the recently-renamed Ministry of Housing, Communities & Local Government (MHCLG).
Written evidence made this week to NALS and the Select Committee hearings that scrutinised the draft legislation has revealed that it will take at least 15 months until letting agents and landlords will no longer be able to charge fees to tenants.
The legislation, which was introduced by Sajid Javid in November last year, was pulled apart by experts during a hearing last Monday. The bill will now go to a third reading in the House of Commons, before moving on to the House of Lords.
During the hearing MPs were told by experts from Shelter and the University of York’s Centre for Housing Policy that a letting fees ban could have the unwanted effect of higher rents for tenants. This is due to the fact that the banned fees would be added to the rents by landlords over the length of each tenancy. The quality of rented accommodation could also decline as landlords seek to offset costs and save money.
CEO of NALS, Isobel Thompson, commented on the results from the hearing: ‘We’re pleased to see more clarity on the timetable for implementation of the ban – it’s much needed for our industry and something NALS has long called for. While the Bill aims to create a fairer and safer PRS for all, NALS doesn’t believe this will deliver what the government aspires to and risks doing real damage to the PRS. NALS urges [the] government to use this time to fully assess the impact of the Bill. It is crucial that government look again at the proposals and consider tenant fees in a broader, coherent framework of regulation for the PRS.’