Tenant Fee Ban Saddles Landlord With Repair Bills

Landlords should not charge tenants a handling fee for arranging repairs - even if the tenant has caused damage to a rental home. 

The tenant fees ban that came into force in England on 1 June and Wales on 1 September 2019 fails to specify how landlords should handle the costs.

 The fee is typically charged by a landlord or letting agent for the time involved in arranging a repair - for instance, a repair billed at £100 by a tradesman may be loaded by 10% (£10), making the final cost £110 for the tenant. 

Housing law demands that the landlord maintain essential services, such as water, drainage and heating - but in practice, the tenant is charged if they cause a repair, such as blocking the toilet. 

Letting agent trade body the Association of Residential Agents (ARLA) asked leading property lawyer Erol Topal for an opinion to determine if the fee can be charged.

“The act very clearly defines those fees a relevant person may be required to pay – these do not include letting agency fees and so the additional fee/commission is not, on the face of it, recoverable,” he said.

He added that the problem with a definitive answer was that the law is too new to have been tested before the courts. 

ARLA decided charging the fee was too risky for letting agents, who have lost significant income since the tenant fee ban started.

“Such a clause may be subject to challenge under consumer protection legislation and, if successful, would be deemed an unfair term,” said ARLA. 

“While agents must make their own commercial decisions on how to take this issue forward, ARLA is not recommending this course of action and as such will not be making any changes to its assured shorthold tenancy agreements.”

Under the law, landlords must take the financial hit for paying the cost of arranging a repair even if the tenant is clearly to blame for the problem.