Housing charity: Tenants' set-up fees too high

A row of houses
Shelter Cymru fears set-up charges will make renting "even more unaffordable" Photo: ITV News Wales

Some letting agencies in Wales are charging new tenants nearly £600 in set-up fees alone, according to new research from a housing charity. Shelter Cymru carried out a mystery shopping exercise to investigate fees at different agents.

You have to question how reasonable these charges are when credit checks can be carried out online for £20 and tenancy agreements are usually standard template contracts. These kinds of unregulated charges are making the private rented sector even more unaffordable at a time when many people in Wales are already struggling to find and keep accommodation.

– John Puzey, Director of Shelter Cymru

The charity found that some tenants could be charged as much as £594 in administration fees for a property at the average market rent. Tenants looking to begin renting usually have to pay the fees on top of a month's advance rent, and a deposit which is normally a month's rent.

Shelter Cymru's survey also found that many charges weren't well advertised, so people looking to rent were unable to discover the costs until they've started an application and have handed over some non-refundable payments. Some agents charge a flat fee to tenants, while others vary it depending on the rent level.

The Property Ombudsman's Code of Practice for Residential Letting Agents, which around two-thirds of lettings agents are currently signed up to, stipulates that agents should flag up any potential liability for fees, charges and penalties 'prior to an applicant's offer being formally accepted'.