Charges Imposed by Landlords and Letting Agents
It is becoming increasingly common for landlords and letting agents in the Perth & Kinross area to charge various fees in association with the granting of a tenancy.
This practice is arguably illegal as the fee requested could be regarded as a 'premium' which is defined as any money which has to be paid in addition to the rent and deposit in order to secure a property. Section 82 of the Rent (Scotland) Act 1984 prohibits landlords and letting agents from requiring tenants to pay premiums.
There are conflicting interpretations of this legislation with some legal experts taking the view that all fees are premiums and others taking the view that landlords and letting agents are entitled to charge a fee that is reflective of the actual costs incurred. There are however some things that landlords and letting agents are definitely not allowed to charge a fee for.
Most landlords and letting agents do not charge any fees over and above the rent and deposit. If you are considering renting a property you should ask the landlord or letting agent if any fees are payable in relation to the granting of the tenancy. If you are asked to pay any fees (see list below) we would recommend that you look for an alternative property that is advertised by a landlord or letting agent that does not charge fees.
There are numerous private rented properties available at the moment in the Perth & Kinross area. You should be able to find a similar property that you can rent without having to pay any landlord/agent fees.
The list below is intended for guidance only and is not a definitive interpretation of the law.
- Accommodation Lists - No payment must be taken from a prospective tenant to have their name placed on an accommodation list. (Accommodation Agencies Act 1953)
- Tenancy Agreements - No fee can be charged in relation to the drafting of the tenancy agreement or associated documents or for the provision of copies of these documents to the tenant. (Housing (Scotland) Act 1988)
- Holding Deposits - See separate page covering Holding Deposits
- Credit Checking & Referencing - Fees should be reflective of actual costs incurred. Most landlords/agents take up bank and employment references without imposing a charge on the tenant. Other landlords/agents charge up to £100 - this is excessive and you may wish to 'shop around' if you are asked to pay such a fee.
- Administration - Some landlords/agents charge an 'admin' fee which is often described as being for general administration, notifying utility companies and setting up direct debits etc. These activities are basic elements of operating a letting business and any associated costs should be considered as operating costs to be borne by the landlord.
- Inventories - Some agents require the tenant to contribute towards the cost of an inventory being prepared by an independent company. There may be potential advantages to tenants in having an independent inventory and as such, you may be happy to pay this fee. It is inappropriate however, for agents to make this a condition of granting a tenancy and you are perfectly entitled to refuse to pay. If this fee is requested after the tenancy has commenced and you refuse to pay, the unpaid fee cannot be considered as rent arrears.
- Re-Signing Fees - Some landlords/agents charge a re-signing fee associated with the renewal of a lease at the end of a contractual period. There is no need for a lease to be renewed as it will automatically continue at the end of a contractual period by a process known as tacit relocation. Again, you are perfectly entitled to refuse to pay and if you do, the unpaid fee cannot be considered as rent arrears.
If you have already paid a fee of some sort in connection with the granting of a tenancy, you may have grounds to raise a small claims action to recover the money. You would be well advised however, to seek independent legal advice before proceeding with such an action.
If you are currently looking for a private rented property, you should be aware that most landlords and some letting agents do not charge any of the fees referred to above and as such, you may wish to bear this in mind when you are considering different properties.
