When is an AST NOT an AST…. When Foxtons says so..

The tenant fee ban act has been in place since 1st June 2019, but is it shocking to see how many Property professionals, also known as letting agents, are either not aware of its existence, or believe they can charge a fee as long as they call it something else.

As most of you know, I am fascinated by the total disregard or ignorance of some agents to the existence of the Tenant Fee ban Act (TFBact).

I spend many a dark night reading through the decisions made by the First Tier Tribunal regarding payments taken by agents and landlords alike which breach the TFBact rules.

Mostly, the breaches are lack of knowledge / education.

I have looked at the last 14 cases that were heard by the First Tier Tribunal relating too Tenant Fees Act - Financial Penalties.

Shockingly of these 14 cases only 3 were brought against landlords who were self-managing, the rest were all against letting agents, a number of which where high street National agents who, in my opinion should have known better.

The most common compliant raised by tenants was agents not refunding the Holding deposit, in all of these cases the Tribunal found in favor if the tenant and ordered the agent to refund the tenant in full

This particular case caught my eye simply for its open attempt to sideswipe the TFBact by a National high street agent who lets face it reputation precedes it

The background

3 tenants entered into a joint tenancy agreement for a property in London for a fixed term of 8weeks.

Foxtons charged each tenant a fixed fee of £250 to cover a variety of works depending on the individual circumstances of each tenancy, including conducting viewings, negotiating the tenancy, verifying references, and drawing up contracts and as specified in the 3 Terms and Conditions attached to the Application for Short Let.

Tribunal Decision

The tribunal found that as the tenants were to live in the property as their main or principle home this met the requirements of the Housing Act 1988 Section 1 (b) which requires the property to be the persons main home and that section 19A of the Housing Act 1996 was met as no minimum term in required to establish an Assured shorthold tenancy.

The tribunal demanded that Foxtons return the full £750 to the 3 tenants as this payment breached the TFBact and was a prohibited payment