Published: 11/06/2019 By Patrick Henry
Now that the Tenant Fee Ban has been enshrined into law and the 1st June 2019 has come and gone we can – hopefully – dispense with the hyperbole and reflect on why the ban was morally a good idea. I am sure it sounds quite bizarre hearing an estate agent support the Tenant Fee Ban, but taking my affection to the size of my bank balance out of the equation, it seems to be the only fair way for us to operate in the residential lettings industry.
During the process of opening Patrick Henry, I did what every business owner should do, and that is to analyse the market and my competition. After spending my career solely in the residential Sales sector, I was astonished by the complexity of the fees that tenants were supposed to comprehend and the costs that they had to bear when renting a property. It seemed to me unfair that not only was there a mental comprehension task and a – sometimes exorbitant – financial cost attributed to the tenant but they also have absolutely no say in the matter. On the other side of the coin, we have Landlords who have their choice of multiple agencies that they can instruct depending on many factors, cost, of course, being one of them. But this is the point; Landlords have a say in which agency they pay a fee to when they let their property, however, tenants have no choice on the agency that they pay to move into their property and must accept whatever charges are requested.
As someone who believes in the power of the free market, it would be very easy for me to say “well if you don’t like the costs associated, then find somewhere else that suits you” but we aren’t talking about a hotel booking or a peak versus off-peak train ticket. This could potentially be someone’s home, and it doesn’t seem right that a tenant should be financially penalised by an estate agent that they didn’t have a say selecting.
I can tell you that from experience 99% of the time landlords don’t think about the costs attributed to the tenants who would be on the receiving end of the estate agents ‘other fee’. The Tenant Fee ban now makes it crystal clear to landlords exactly what the entire cost is when selecting an estate agent and for the estate agents there is no way to hide their true costs by offsetting charges to the tenants.