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Fair Fees Forum 26/4/17 – Communique

3rd May 2017

COMMUNIQUE

FAIR FEES FORUM – WORKING GROUP

  1. The Fair Fees Forum met on Wednesday 26 April.
  2. Attendees at the Forum included; Belvoir, Chestertons, Countrywide, Hamptons, Hunters, Ryder & Dutton, Savills, Winkworth, Crisis, Shelter, Association of Residential Letting Agents, British Property Federation, National Approved Letting Scheme, Royal Institution of Chartered Surveyors, National Landlords Association, Residential Landlords Association, Greater London Authority (in listening mode), The Property Ombudsman, Ombudsman Services: Property, Property Redress Scheme, myDeposits, Deposit Protection Scheme, Tenancy Deposit Scheme.  The Department for Communities and Local Government were at the Forum in listening mode.
  1. The group discussed changes since the last meeting, which included the launch of the consultation and the announcement of the General Election.
  2. The Group collectively reviewed and discussed elements arising from the consultation document, which included:
  • Existing regulatory measures, and their success or otherwise
  • Regulation
  • Unintended effects and risks of the fee ban
  • Deposits
  • Implementation of the ban and the effect on consumer complaints and redress
  1. An overarching message that came from all members was the need for a coherent framework for the regulation of the private rented sector, instead of the current piecemeal approach to legislation, which did not help consumers or the industry. It should include registration of all letting agents, the conduct of their business and effective enforcement. The Forum recognised the need for a working group to draw up a regulatory framework with which to approach Government.
  2. There were also calls for a more cohesive approach to licensing by Local Authorities.
  3. The Group noted the innovative ideas and solutions being put forward for helping tenants fund deposits but agreed further work needed to be undertaken in this area.
  4. The Agent members of the Group highlighted what they viewed as the risks of the fee ban which included
  • Increased self management by landlords, many of whom had limited expertise of housing management or knowledge of health and safety requirements;
  • Problems which would arise if it was not possible to charge for referencing which could lead to the exclusion of vulnerable tenants or those in receipt of housing benefit;
  • Possible lack of access for tenants who relied on a guarantor;
  • Cost implications for tenants with the loss of the paralegal role of the letting agent in negotiating tenancy clauses.
  1. A common theme of the meeting was the need for robust enforcement. This arose from concern about the existing legislation not being effectively policed. It was therefore essential that enforcement arrangements and adequate resources were in place before any fee ban commenced.
  2. Concern was also raised as to how complaints and redress would be handled if the tenant no longer had a relationship with the agent. The Group agreed further work was necessary to consider how redress and protections for the tenant could be delivered.
  3. Following the Competition and Markets Authority (CMA) response to the Forum’s earlier request of a review of fees and charges, the Group agreed to contact the CMA again to ask it to consider the potential for unintended consequences on competition now the consultation is underway.
  4. The Group agreed to meet in July after the consultation had closed and the new Government was in place.

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