UK letting agents to be banned from charging fees to tenants

So apparently the fees that agents charge students (and other tenants) when they move into private accommodation (for 'administrative costs') are getting banned soon.

I have mixed feelings about this as on the one hand I appreciate that the fees can be quite high and landlords should be paying these costs. However, the other side is that letting agents offer a service to students and also have legitimate costs related to applications. An economics / free-market thinker would probably argue that the price should settle at the market price (i.e. not at an excess) as any agent charging too much would not be selected by a student. However, with the market in limited supply, many students don't get a choice of which house / agent to take.

https://sturents.com/news/2016/11/22/hammond-set-to-ban-letting-agent-fees/891/

Reply 1

limetang

Letting agents offer a service to LANDLORDS not students in terms of dealing with legal matters, leases, sorting out the property etc. The only costs I should have to pay are my rent and a deposit. Yes, there are costs associated with maintaining a house, leasing it etc. but it's the landlords responsibility to deal with those, not mine. It's the same with any other product or service I buy. If I pay for a chocolate bar in a supermarket I'm not given the base price of the chocolate bar and then given things like a supermarket surcharge for paying the wages of supermarket employees etc. in addition to it.

Reply 2

blue n white army

Never liked paying admin fees but what's going to happen is that state agents won't just accept that they'll just make do without this revenue stream. They'll pass this cost onto the landlords who in turn will bump up rents.

In short I think this will work out well for those who move around a lot but people who stick in one place long term will end up paying more.