Letting Agent Fees (Tenants)

Debate between Albert Owen and Derek Thomas

Wednesday 6th September 2017 Westminster Hall

[Derek Thomas (St Ives) (Con)]

Thank you, Mr Owen. I am grateful for the opportunity to speak, and I commend my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) on securing this important debate.

I welcome the Government’s action. When I first became a Member of Parliament in 2015, I was amazed at the number of prospective tenants who came to see me about this issue. We surveyed all the letting agencies and my office was surprised by the sheer scale and variation of charges, so I completely welcome the opportunity to get rid of charges altogether. I have three points to raise for consideration and clarification, and I hope, Mr Owen, that they will not take too long.

First, is there the potential or a plan to cap the deposit? The deposit is often set at a month’s rent. The difficulty of finding the deposit is often the greatest barrier people face in looking for a home. However, rents vary dramatically from region to region. As a result, a deposit that relates to rent can be thousands of pounds in London and a few hundred elsewhere. If the Government plan to cap the amount of deposit that can be charged, will the Minister indicate how the figure will be established? In my view, the deposit should reflect what would be a reasonable amount to bring a property back to its former condition, rather than a typical month’s rent.

I have spoken with letting agents and tenants about what the deposit might be and how that might be regulated, and it is still necessary to have some flexibility. That is in the interest of the tenant. For example, a prospective landlord may consider allowing a pet into a property in return for a slightly increased deposit. If there is no flexibility or consideration given to accommodate a pet, a person who relies on the companionship of a dog or a cat may find it hard to secure a rental property and, as a result, be discriminated against by the cap on what deposit can be charged. I would be interested to hear the Minister’s thoughts on that issue.

Finally, consideration and clarification are needed on how changes are made during a tenancy and who pays for them. If a tenant requires a change during a tenancy, such as removing a name from a tenancy agreement, that will inevitably incur a cost. Tenants need to feel that changes to their agreement can be made easily and when necessary. We must be careful not to create further barriers for tenants and, when bringing in legislation, we need to be careful that we understand clearly who will cover the cost of changes to a tenancy.

I again commend my hon. Friend the Member for Thirsk and Malton for securing this debate. I am grateful for your patience, Mr Owen, and I look forward to the Minister’s response on how deposits will be capped and on who pays for changes during a tenancy when those changes are in the interest of the tenant.

[Albert Owen (in the Chair)]

I am grateful to the hon. Gentleman. I have not put a specific time limit on speeches, but if people keep to what we have just had from Mr Thomas, we will get everybody in.