KIS boss “not convinced” by draft letting agent fee ban and deposit cap
 
Published on 01 Nov 2017

A leading North East property campaigner is “not convinced” by government plans to make it a criminal offence for letting agents to charge tenants fees and to cap tenancy deposits.

Ajay Jagota, founder of South Shields- based sales and lettings firm KIS and deposit free renting firm Dlighted and campaigner for privately rented property reform, has responded to today’s publication of the Draft Tenant’s Fees Bill.

The Bill will.
•    Cap holding deposits at no more than 1 week’s rent and security deposits at no more than 6 weeks’ rent.
•    Require landlords and agents to return holding deposits to tenants.
•    Fine agents £5000 for an initial breach of the ban on letting agent fees, and create a criminal offense for agents who are fined or convicted of the same offence within 5 years.
•    Delegate enforcement of the ban to local Trading Standards officials.
•    Allow tenants to recover unlawfully charged fees.

Ajay Jagota responded to the draft legislation, which was first announced by Chancellor Phillip Hammond in last year’s Autumn Statement.

He said: “Renting in Britain needs to change, but I’m not convinced this is the change it needs.

“By capping deposits at the industry standard of six weeks rent, all these ‘reforms’ actually do is protect the status quo. So what’s the point of them?

“Deposits will still place a huge financial burden on renters at a time when wages are falling but inflation and debt are rising. This burden makes it harder to find and keep tenants, but ultimately does little to protect landlords against property damage and unpaid rent. 

“The fee ban is likely to place a major financial burden on letting agents too, which is likely to lead to higher rents and other costs for renters.

“It’s clear that now is the time for landlords and agents to think about deposit free renting, even if the government has ducked the issue for now. Not only does deposit replacement insurance save letting agents time and money while better protecting landlords and finding tenants faster, it also allows them to differentiate themselves from the competition in a post fees-world.”

Ajay Jagota heads the #ditchdepositsnow campaign, which seeks to persuade the government to add an additional deposit free renting option to the three government licensed deposit protection schemes – mydeposits, the Tenancy Deposit Scheme and the Deposit Protection Scheme.

KIS were the first letting agents in the UK to abolish deposits, replacing them with landlord insurance.

Dlighted is a deposit-free renting solution which replaces traditional cash deposits with low cost deposit replacement insurance, allowing properties to be rented deposit free while providing landlords over £600,000 of protection against legal fees and property damage and a rent guarantee.

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