Camden Council has collected £10,500 in fines from letting agents who failed to adhere to new consumer rights act, as Cllr Sian Berry calls for and outright ban on letting agents’ fees in a new report criticising lacklustre enforcement accross London
Camden Council is one of only four councils across London to have issued fines against lettings agents who failed to clearly display their fees.
Rules brought in by the Consumer Rights Act in May 2015 require letting agents to clearly display fees and become a member of both deposit and redress schemes.
Camden Council recieved a total of 125 complaints made against agents. In response they sent no warning letters but made 28 visits, issued 34 notices of intent and sent 24 final notices.
In total the council recieved £10,500 in fines.
Only Islington, Kensington and Chelsea, and Newham councils issued fines. Islington took £42,000 in fines, nearly two thirds of the £66,000 collected across the capital.
The data was compiled as part of Green Party London Assembly Member Sian Berry’s report on the issue.
In ‘Letting them get away with it’ she argued that councils are not doing enough to enforce the regulations, and has called for the government to support councils’ attempts to enforce the law with an outright ban on letting agents’ fees.
“Everyone who rents knows horror stories of last-minute charges or hidden fees added by letting agents,” said Cllr Berry. “We need to stop these unjust costs that hit people at their most vulnerable when they are worried about securing their home.”
According to the study, less than a third of the 1351 complaints made about letting agents were acted upon since measures were introduced. Across London only 444 visits were made by trading standards officers while just 52 final notices were issued. Of the 363 warning letters sent in response to complaints, 178 referred to failings on redress schemes, whilst 169 referred to failing to disclose letting fees.
“I think the fact that some councils are doing more and some councils are doing less shows that it’s a choice they’ve made of what to prioritise,” said Cllr Berry.
“It’s good that Camden seem to have made a choice to prioritise this issue because it blights people’s lives so badly when you get a bad letting agent.”
Cllr Jonathan Simpson, cabinet member for community safety at Camden Council said: “Since 2015 we have been undertaking enforcement action against agents, advising over 300 operating across the borough on best practice and their legal responsibilities.
“We have followed this up with enforcement action when needed, including issuing penalty charge notices for breaches against a number of agents who exploited private tenants and landlords through actions including not displaying trading fees at either their premises or on their websites.”
The government announced a proposed ban on letting agents’ fees, which is estimated costs renters £233 per year, w in the Autumn Statement.
The ban is still at the consultation stage, but Cllr Berry would like to see it enacted as soon as possible.
“Banning letting fees to tenants would clearly go a long way to cut down on the exploitation of renters when they can least afford it,” she said.
The proposed ban is facing industry criticism since fees provide one fifth of letting agents’ revenues.
The ban could jeopardise 4000 jobs and result in average annual rent increases of £103 should landlords take on the cost, according to a new report by the Association of Residential Letting Agents, ARLA Propertymark.
“Those tenants who move least frequently, which tend to be lower income families, will be worst hit by rent rises,” said David Cox, chief executive at ARLA Propertymark.
“This is ironic and shows that there will be unintended consequences to what, in effect, is a crowd-pleasing, populist policy.
The study suggested long term tenants would end up paying £755 more over a ten year period if upfront fees were banned.
ARLA also reported that a quarter of agents in Scotland say they no longer complete standard credit checks since a ban was introduced in 2012.
Cllr Berry rejected the claims. “Even if they put every single penny that they currently charge to tenants onto the rent you’d still be better off because you’d be paying it gradually over time,” she said.
In October, over 1,500 Londoners responded to a rental survey by Berry. ‘What are London’s renters thinking?’ reported that top concerns included return of deposits and unannounced rent rises.
35 per cent said that unexpected letting agent fees were the biggest problem overall while 30 per cent reported a bad experience with their agent, citing communication problems, unexpected costs and unreasonable pressure.
The Mayor of London Sadiq Khan campaigned on ‘getting a better deal for renters’ as part of his number one pledge in his Manifesto for all Londoners. The Mayor promised a London-wide, non-profit letting agency for good landlords, to put an end to what he called ‘rip-off fees’.
Khan had previously announced plans to create a ‘name and shame’ database of rogue landlords, which Berry hopes will include letting agents who flout the law.
“My officers will look into how criminal letting agents can best be covered by our approach to naming and shaming rogue landlords,” Khan said in December.
“These measures can’t come quickly enough,” said Cllr Berry, who is worried the proposal might fall by the wayside should a ban come into effect.
“In the housing crisis nothing is a silver bullet so this is not going to solve the whole housing crisis but it will remove a significant source of injustice.”
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