Northern Ireland

Letting agents: Some in Belfast charging unlawful fees

Terrace houses
Image caption Bans on letting fees are being implemented in the rest of the UK this year

Some Belfast letting agents are continuing to charge pre-tenancy fees despite a court finding it unlawful.

Prospective tenants are being asked to pay £15 to £60 each alongside their application to rent a property.

BBC News NI contacted 52 Belfast letting agents about tenancy fees - more than two-thirds were still implementing the charge.

Agents say these cover administration costs including credit history checks and employment references.

The charges are often non-refundable even if a landlord chooses a different person to rent the property.

Of the 52 letting agents, 35 said they were charging and 17 said they were not.

In 2017, Paul Loughran, who has since joined the Acorn Housing Union, challenged the fees in court after he was charged by two separate letting agents.

Image caption Paul Loughran took a legal challenge against letting fees and won

The judge's ruling found he was wrongly charged and that the costs should, instead, be billed to landlords.

"In paying the administration fee, the tenant was contributing in part towards the cost of the services the letting agent had been commissioned by the landlord to do," the judge said.

The judge also ordered the return of the fees.

It means letting agents could potentially be asked to refund the application charges to tenants and former tenants, amounting to thousands of pounds.

Mr Loughran said that those seeking to rent "tend to be younger people who maybe can't afford to buy their own house and are already hit with fees such as a deposit fee".

"So it's a further hindrance and a further barrier to housing," he added.

Image caption Madeleine Keenan has been looking for a place for herself and her two-year-old son

Madeleine Keenan, a 21-year-old who is looking for a home for her and her two-year-old son in Bangor, County Down, said upfront charges are making the process difficult and expensive.

"I only work part-time because I have him, but each of the agencies charge about £30 or £40 to put in the application," she said.

"Once you apply for the house and spend the money there's still a chance you don't get the property and you don't get your money back."

"So if I wanted to apply for three houses, you're talking about £120 that I just don't have."

She added that a "a bigger family with a stronger income" was more likely to get the home instead of her and that "just puts me off applying in the first place".

Image caption Applicants do not get their money back even if they are not chosen to be tenants

A ban on lettings fees in England came into force in June while landlords and agents in Wales will be banned from charging extra fees from September.

In Scotland, letting agent fees were banned in 1984, and in 2001 in the Republic of Ireland.

With no assembly sitting in Northern Ireland, no new specific legislation has been introduced in relation to the charges.

The judge's ruling that tenants could not be charged upfront costs in Northern Ireland was based on the Commission on Disposal of Land Order 1986.

That legislation was introduced in the 1980s after lobbying by student groups who argued it was unfair.

Image caption Ellie Evans of Shelter NI says prospective tenants pay up because agents have the power

Ellie Evans, of the housing charity Shelter NI, said estate agents "know they can get away with it" and tenants "are too scared of retaliation".

"They don't have the same structural power that estate agents have. If they (tenants) say, this fee is illegal I don't want to pay it, they (letting agents) might say that you might not get the property.

"Or people might still be in the property and don't want to ask for their money back in case they get evicted.

"It's just about power and, right now, the power is in favour of the letting agents."

Image caption Samuel Dickey said a working Stormont executive could enact legislation on letting fees

Samuel Dickey, the RICS (Royal Institute of Chartered Surveyors) spokesperson in Northern Ireland, said if Stormont was in place, then laws could be introduced to enforce the rules on fees.

"It is not to say that the letting agent can't recover the fees but they have to charge them to the landlord and not the tenant.

"There is a lack of enforcement and a lack of policing. Who is going to take them (letting agents) to task? We need regulation in the industry."

He said he believed there was a review of the private rental sector underway by the Department of Communities but that it had "fallen by the wayside" in Stormont's absence.

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