Letting Agency Fees for Tenants - Unfair, Immoral but not yet illegal: The Position in 2026
Letting agency fees for tenants - Unfair, Immoral but not yet illegal - are charges imposed by letting agents during the rental application process and throughout a tenancy. Letting Agency fees for tenants - Unfair, Immoral but not yet illegal These fees cover various administrative tasks such as contract drafting, inventory checks, credit assessments, reference acquisition, and even maintenance of records over the course of the tenancy. In 2026, despite efforts to regulate these costs through legislation like the Tenant Fees Act 2019, letting agents in England and Wales can still legally charge tenants significant sums for services that are often considered basic business operations.
These fees have long been a contentious issue among renters due to their financial impact. At an average cost of £600 per tenancy, these charges compound the initial burden on new tenants who must already fork out several weeks' worth of rent as security deposits and advance payments. This scenario is particularly challenging for low-income households or those in precarious employment situations.
The situation remains largely unchanged since the Tenant Fees Act 2019 was enacted to curb excessive costs, but there are now additional regulations that affect this issue, including the Renters' Rights Act 2025 and other updates. Despite these legislative efforts, letting agents can still impose fees for services that tenants might not initially recognise as necessary or important.
What the Law Says
The legal framework governing letting agency fees is primarily found in the Housing Act 1988 (ss.8, 13, 21), the Landlord and Tenant Act 1985 (s.11), and the Deregulation Act 2015 (s.33). These statutes set out broad guidelines for rental agreements and tenant rights but don't explicitly address fees charged by letting agents. The Housing Act 2004 (ss.213-215) also contributes to the regulatory environment, particularly concerning disrepair issues.
The Tenant Fees Act 2019 was a significant step in curbing unnecessary costs for tenants by banning certain fees such as those related to references and inventory checks. However, it did not eliminate all letting agency charges, leaving room for agents to impose other types of administrative fees that could still be considered exorbitant.
How the Renters' Rights Act 2025 Changes This
The Renters' Rights Act 2025 introduced several measures aimed at further protecting tenants from unreasonable costs and improving living conditions. At Letting Agency fees for tenants - Unfair, Immoral but not yet illegal, one key change is the abolition of Section 21 notices. Which typically made it easier for landlords to evict tenants without a specific reason. Additionally, periodic tenancies are now required to start immediately upon agreement, eliminating the need for initial fixed-term contracts that can be costly to break.
The act also established an annual rent cap through Section 13, ensuring rents don't increase beyond what's reasonable and fair. It extended the Decent Homes Standard to cover the private rented sector (PRS). Mandating landlords to maintain their properties to a higher standard of habitability. Awaab's Law has been expanded to include all private landlords. Increasing accountability for issues like mould and damp that affect tenant health.
the act created a new Private Rented Sector Ombudsman, providing an additional avenue for dispute resolution beyond local authorities or Housing Ombudsmen. The PRS Database registration system is designed to track landlord compliance with regulations, thereby holding them accountable for meeting their legal obligations.
What This Means for Tenants
For tenants in 2026, the Renters' Rights Act 2025 offers a clearer set of guidelines and protections against exploitative practices. However, despite these advances, letting agency fees remain an issue to be wary of. While certain fees are now banned under the Tenant Fees Act 2019, others still exist, including administration costs or amendment charges that may be imposed during tenancy.
Tenants should carefully review any contracts and agreements with their letting agent before signing anything. If faced with unreasonable fees, it's important to seek advice from organisations like Shelter or Citizens Advice. Tenants can challenge unfair charges by sending a formal complaint letter to the landlord or letting agency, detailing why the fee is unjustifiable under current legislation.
What This Means for Landlords
Landlords must comply strictly with both existing and new regulations regarding tenant fees. The abolition of Section 21 notices means landlords can't simply serve notice without cause, making it important to have valid grounds for eviction if necessary. Additionally, maintaining properties to the Decent Homes Standard is now mandatory under Awaab's Law.
Compliance obligations extend to adhering to the annual rent cap and registering with the PRS Database. At Letting Agency fees for tenants - Unfair, Immoral but not yet illegal, failure to comply can result in legal penalties and damage to a landlord's reputation within the rental market. Landlords should familiarise themselves with all relevant statutes and seek professional advice if uncertain about their responsibilities.
Common Scenarios
Scenario 1: Additional Person Fee
A tenant shares a flat with friends and needs to add another roommate mid-tenancy. The letting agent requests an additional person fee of £200, citing administrative costs for updating the tenancy agreement and conducting a new credit check on the new roommate.
Resolution: Tenants should challenge this fee by contacting the letting agency in writing, requesting justification for the charge under current regulations. If no valid reason is provided, tenants may seek further advice from Shelter or Citizens Advice.
Scenario 2: Amendment Fees
A tenant needs to extend their tenancy agreement but encounters an amendment fee of £150 when they approach the letting agent. The tenant believes this fee is unreasonable given that a simple extension shouldn't incur such costs.
Resolution: Tenants can send a formal complaint letter explaining why the charge appears unfair and request a waiver based on existing legal protections against excessive administrative fees. If unresolved, tenants may escalate their concerns to the PRS Ombudsman or seek help from local council environmental health services.
Scenario 3: Inventory Check Fees
A tenant moves into a new property but is charged £120 for an inventory check that they believe should be covered by the landlord as part of setting up a tenancy agreement. The fee seems excessive and burdensome given other upfront costs like deposits and advance rent payments.
Resolution: Tenants should review their contract carefully to see if such fees are mentioned explicitly. If not, or if the fee appears unreasonable, they can challenge it through a formal complaint letter to the letting agency, supported by legal advice from organisations like Shelter or Citizens Advice.
Evidence Tenants Should Keep
Tenants facing questionable fees should maintain thorough records of all communications with their landlord or letting agent. This includes:
- Contract and Agreement Copies: Ensuring you have copies of all signed documents related to your tenancy.
- Correspondence Records: Keeping detailed logs of emails, letters, phone calls, and any other forms of communication regarding the fees in question.
- Dates and Times: Recording exact dates and times when discussions about these fees occurred can be important for timelines and dispute resolution.
it's beneficial to gather:
- Photographs: If the property is in poor condition or if there are issues like mould that could affect your rentability claims.
- Witness Statements: Written accounts from friends, family members, or other tenants who can corroborate your situation or provide additional context.
These documents serve as important evidence when dealing with disputes and legal proceedings related to unfair fees.
What to Do If Things Go Wrong
If you find yourself in a dispute over letting agency fees, follow this step-by-step escalation path:
- At Letting Agency fees for tenants - Unfair, Immoral but not yet illegal, Send a Complaint Letter: Start by sending a formal letter to the landlord or letting agent outlining your concerns and requesting either a refund of paid fees or agreement on a more reasonable fee structure.
- Local Council Environmental Health Department: If there are issues related to property condition affecting habitability, contact environmental health services for intervention.
- Deposit Scheme Dispute Resolution Service: Use this service if disputes arise over the return of your deposit following a tenancy's end.
- Housing Ombudsman or PRS Ombudsman: These bodies provide independent dispute resolution for issues that haven't been resolved through initial channels.
- First-Tier Tribunal (Property Chamber): For more serious cases, consider filing an application with the First-tier Tribunal to seek judicial review of your case.
- County Court: As a final recourse, you may need to pursue legal action in a county court if all other avenues fail.
Each step can help build a stronger case and increase pressure on letting agents or landlords to address unfair fees appropriately.
Common Mistakes to Avoid
Both tenants and landlords often make mistakes when dealing with letting agency fees. Tenants might overlook the importance of detailed records, while landlords may underestimate their legal obligations:
- Overlooking Contract Details: Failing to read contracts thoroughly can lead to missed clauses regarding fees.
- Lack of Documentation: Not maintaining proper documentation means you'll have a weaker case if disputes arise.
- Ignoring Legal Advice: Relying solely on your own interpretation of laws rather than seeking expert advice from organisations like Shelter or Citizens Advice can be risky.
- Failing to Escalate Issues: Staying silent about unfair fees allows them to persist, which is counterproductive for resolving the issue.
- Underestimating Tenant Rights: Both tenants and landlords might undervalue recent legal protections under acts such as the Renters' Rights Act 2025.
Avoiding these pitfalls can help ensure a fairer and more transparent rental experience.
Where to Get Help
When facing issues with letting agency fees, consider reaching out to reputable organisations for support:
- Shelter: Offers free advice via its website and helpline.
- Citizens Advice: Provides practical guidance on tenant rights and fee disputes.
- Local Council Housing Team: Can offer localised assistance and intervene if necessary.
Legal aid may be available in certain circumstances, such as when dealing with serious breaches of tenancy agreements or severe habitability issues. Always check eligibility criteria before applying for legal aid.
By utilising these resources, tenants can deal with the complexities of letting agency fees more effectively and protect their rights within the UK's evolving rental situation.