Do you know about the lettings fee ban proposal?
As a landlord it is your responsibility to keep abreast of the law and any changes that may affect you or your tenants. But according to a new study, around a quarter of property letters are not aware of a major new change to legislation that could have far-reaching effects. This is a proposed lettings fee ban that could alter the way income models work for many landlords and even increase costs to tenants.
The ban, which was proposed last year, means that tenants are no longer required to pay anything other than rent and a refundable deposit. All other charges will need to be met by the landlords themselves. But around 31% of landlords surveyed were completely unaware of the bill.
There is a fear among those who were aware of the bill that this could mean letting agents will pass on the fees to landlords, who will, in turn, be forced to increase rents to meet these extra demands. However, Housing Minister Alok Sharma claims that evidence shows “it won’t have the negative consequences people have suggested it would”.
However, it’s not all bad news. Many landlords believe that the ban may make letting agents more competitive and even improve the services they offer. But the cap on deposit at one month’s rent may also cause some issues by restricting who landlords are willing to rent to – in terms of allowing pets and accepting tenants with bad credit ratings.
On the whole, there is a feeling that the new laws are going some way to making the industry more streamlined and efficient, as well as increasing transparency in the industry. It may even help to save money for all involved, including landlords.
However, the new law plays out, if you are a landlord and unaware of the changes, then you need to get up to speed. This could affect the way your income stream works.
If you’d like to know more about it, or have any questions about the investment market in the Norwich and Norfolk area in general, then get in touch with our team at Agile. We’re always happy to chat!
For more free tips on Property Investing SIGN UP HERE.