Take pragmatic view on rental fees, Castles’ Mark Noble urges government
The government should take a pragmatic view on the issue of the admin fees lettings agencies charge tenants, says Mark Noble, managing director of Swindon estate agent, Castles Residential Sales & Lettings.
Mark was responding to the Autumn Statement 2016, in which Chancellor of the Exchequer Philip Hammond announced that letting agents' fees are to be banned in England and Wales as soon as possible.
“This could be seen as a knee jerk reaction. It would be far more sensible to take a pragmatic view on the costs involved and set the maximum agencies can charge for each set of circumstances.
“We agree that the days of any letting agents overcharging tenants must end but believe we can find a compromise. Surely, tenants should pay for their reference fees in the same way people buying property pay for their surveys and legal services?
“The most likely upshot of this is that agents will pass on the extra costs to landlords who, in turn, will recover the difference through higher rents. And with demand outweighing supply in the rental sector, there’s nothing to stop this happening.”
Mark also voiced reservations about the Chancellor’s decision not to reverse additional stamp duty or cuts to mortgage tax relief on second, or buy-to-let, homes.
“I’m not convinced that extra taxes for landlords or owners of second homes benefit first time buyers.” Mark said. “The crucial factors for first time buyers are the ability to secure a mortgage and save up for a deposit. Investment buyers are looking long term – in many cases up to ten years - to get a return on their outlay, so will absorb the extra taxes over the period of their ownership.
“Overall, I hope common sense prevails. The government needs to realise that, by abolishing tenants’ fees and punitive taxes for landlords and buyers of second homes, it’s threatening to damage an already fragile housing market that really only needs a sensible correction.”