A government consultation aimed to prevent the real estate agencies of England to charge a fee for the mediation is likely to start in the spring. The Minister for Housing Gavin Barwell has confirmed that consultation will begin in the spring and the proposed bill will become part of the overall concept designed to protect the market of private hire, making it stable for both tenants and landlords.
The ban will have a fall effect on all participants in the rental market of England – both on the Agency and tenants and homeowners. Meanwhile, the uncertainty that’s happening right now on the market can have a negative impact on sentiment.
As a real estate Agency in the UK and the clients, not knowing what conditions they will continue to exist, awaiting the details of the upcoming amendments to the law.
Representatives of real estate agencies expect that complicated procedures for eviction of insolvent tenants, which in turn can increase the idle periods of the property. These risks will affect the cost of insurance coverage.
In 2012, a similar law prohibiting real estate agencies charge a fee if you let out residential property to rent, was launched in Scotland. Now it can be viewed as a rehearsal for the English rental market. In General, it should be stated for the past 5 years that the Scottish Agency has covered their costs by increasing rents.
About a year after ban study was conducted, which revealed that only 2% of landlords have raised rents as a direct result of prohibition. A study of the Scottish experience has also shown that the ban has allowed us to focus on improving professionalism and standards of quality and the negative effect is minimal for all market participants – agents, homeowners and tenants.
® Alice Morgan. 05.03.2017 G.
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