Bunk, the all in one property app that empowers landlords and tenants with the tools to rent without the need for a letting agent, has looked at the cost saving for UK renters as a result of the newly introduced Tenant Fee Act 2019.
Bunk looked at the number of rental transactions within the private sector, and the average tenant fee paid prior to the ban, to ascertain just how much the nation’s tenants were being forced to pay by letting agents in fees.
According to the latest Government report on churn in the private rental sector, there are some 860,000 rental transactions a year across the UK.
Data from the latest English Housing Survey, as cited in the Tenant Fee Act 2019 itself, shows that the average tenant is being charged £223 in fees alone.
That’s a whopping sum of £191,780,000 a year in fees and the primary reason for the introduction of the Tenant Fee Act 2019.
There has been a great deal of trepidation around the fee ban with many believing letting agents will simply look outside of the new rule book to find additional ways to recoup this lost revenue through increases in fees to landlords and inevitably rents as a result.
Co-founder and CEO of Bunk, Tom Woollard, commented:
“For far too long letting agents have essentially been writing their own rules when it comes to the fees they charge tenants for all manner of things, and as a result, it has left a very sour taste in the mouths of many in the renal sector.
The ban on tenant fees is undoubtedly a step in the right direction as we now have a clear piece of legislation that letting agents, landlords and tenants can all adhere to with a good level of accountability when this isn’t the case.
Until this point, the majority of letting agents have essentially been taking extra money above and beyond any justified fees for no additional work and so the thought that they might try and recoup this ‘lost’ revenue through rental hikes or any other means is quite laughable.
Only time will tell if this does happen and there will no doubt be a knee-jerk reaction of some sort by the industry. Hopefully, it will act as a catalyst for the sector to stand up and show it can provide a good service for a reasonable fee, and that letting agents still hold some value in a world where technology and innovation will undoubtedly render them obsolete.”