From today (27th May 2015) all Letting Agents have to be compliant with Chapter 3 of the Consumer Rights Act 2015 or face a possible fine of £5,000 and have advertisements removed by the Advertisement Standard Agency.
What has to be done?
The act asks for three main actions:
- Details of all fees they charge;
- Whether or not they are a member of a client money protection scheme and details of the same;
- Details of redress scheme they have joined (Which has been a must in England since October 2014 and is a criminal offence and carried a fine of £5,000 if not done.)
What details have to be provided?
The fees (both offline and online) have to give enough information so a person can work out exactly what they are paying for. It must explain whether the fees are per property, per person and if it cannot be worked out in advance (such as commission) an explanation as to how it is calculated. All fees must be shown inclusive of vat.
You must also provide details of charges and penalties in the Tenancy Agreement and Terms Of Business, for example inventory fee, late charges, check in and check out fees etc. (rent and deposit are excluded from the list but not holding deposits).
The guidance states:
“The list of fees must be comprehensive and clearly defined; there is no scope for surcharges or hidden fees. Ill-defined terms such as administration cost must not be used.”
Full lists of fees have to be displayed on the premises and online if applicable.
An example of an acceptable advertisement would be (provided by CAB):
2 bedroom flat available to rent
Rent £500 pcm + £150 admin fees & £75 credit check
The CAB has proivded a tool to report agents who do not comply. More information on the act and penalties can be found in the explanatory memorandum and act itself.
