Tenant Fees Act 2019

As most will have gathered from the many news reports over the weekend, the Tenant Fees Act 2019 came into effect on June 1^st. This means that landlords and agents are no longer able to charge tenants for a range of administration fees and that tenancy deposits have been capped at five weeks rent.

The legislation under this Act will apply to all tenants entering into Housing Act Tenancies; the most common being Assured Shorthold Tenancies, licences to occupy and many student lets.

The Tenant Fees Act 2019 will apply to new tenancies signed on or after 1^st June 2019 and renewals of tenancies. As from 1^st June in addition to rent, lettings agents and landlords can only charge tenants (or anyone acting on the tenant’s behalf) the following permitted payments:

• Holding deposits (a maximum of 1 week’s rent)
• Deposits (a maximum deposit of 5 weeks’ rent for annual rent below £50,000, or 6 weeks’ rent for annual rental of £50,000 and above)
• Payments to change a tenancy agreement eg. change of sharer (capped at £50 or, if higher, any reasonable costs)
• Payments associated with early termination of a tenancy (capped at the landlord’s loss or the agent’s reasonably incurred costs)
• Utilities, communication services (eg. telephone, broadband), TV licence and council tax
• Interest payments for the late payment of rent (up to 3% above Bank of England’s annual percentage rate)
• Reasonable costs for replacement of lost keys or other security devices
• Contractual damages in the event of the tenant’s default of a tenancy agreement and
• Any other permitted payments under the Tenant Fees Act 2019

The Act also states that agents and landlords don’t have to pay back any fees they have charged a tenant before 1st June 2019. So, if an agent or landlord requires a tenant to pay a fee linked to a contract that started before the ban came into force, such as check-out or renewal fees, they can continue charging those fees until 31st May 2020.

As with all legislation it is not straight forward so please do call or email The Country House Company if there is any aspect of this you wish to discuss.