The events in Parliament today ( June 21) has confirmed that at least one election promise by the current Government will be fulfilled within this Parliament. The Queen announced that the Government intends to bring in legislation to prohibit a tenant having to pay the fees of letting agents in England. The Tenants Fees Bill will be introduced. Fees are usually required for referencing, credit checks and since the advent of s41 Immigration Act 2016, Immigration checks.
Although the Government remains in minority at the time of writing this, as most of the major parties supported this policy, it is likely to be passed. This of course follows similar legislation in Scotland.
The figures for payment vary from place to place but Government figures place the mean at £223.00, although in London they may be substantially higher. The checks are still going to be needed, for protection of the landlord, for both financial reasons and of course due to the implications if a landlord fails to comply with s41 Immigration Act 2016.
It seems likely that the higher costs will inevitably find their way into the rents. In the short term however this will be yet a further burden for a landlord. If an Agent is instructed, then they will require payment so this is something that will have to be built into budgets for some time. Further there is the indication that tenants will be able to recover any fees charged unlawfully. It is unclear as yet whether this will be from the agent direct, or as seems probable that normal agency law will apply and a landlords agent is to be treated as acting for the landlord, so that the money will be recoverable direct from the landlord. Only the legislation will confirm.