Fears of landlord ‘loophole’ in Tenant Fees Bill

Generation Rent sees scope for landlords to include unfair clauses in tenancy agreements.

Landlords could use a loophole in the Tenant Fees Bill to hang “spurious” charges on tenants, Generation Rent fears.

A clause in the Bill could give landlords leeway to include unfair clauses in tenancy agreements which could be difficult for the tenant to abide by, said Generation Rent Director Dan Wilson Craw.

“It would be difficult for the tenant to prove that a payment demanded as a result of defaulting on a tenancy term exceeded the loss suffered by the landlord – so it would be difficult to challenge an unfair payment,” he said.

Generation Rent also sees setting the cap on deposits at six weeks’ rent as a big barrier to moving home.

“The government needs to look at how to reduce the burden of this, for example by allowing the transfer of deposits between tenancies,” said Wilson Craw.

Both the Residential Landlords Association (RLA) and Arla Propertymark have sounded warnings of their own on the Bill introduced to the Commons this week.

To the RLA, the Bill is a missed opportunity to make quicker and more lasting improvements in the rental market – taking months to become law and then a considerable time to implement when much quicker changes could be made by better enforcing existing regulations.

ARLA Propertymark is also sceptical as to the scope for the Bill to achieve its aim, citing its own research as saying tenants will end up worse off with a fee ban not seeing a more affordable private rented sector.

  • The potential loophole is found in Schedule 1, Clause 4 (page 23) of the Bill:

https://publications.parliament.uk/pa/bills/cbill/2017-2019/0203/18203.pdf

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