Rental fee rage
A casual conversation in the hairdresser’s last week opened my eyes to the financial obstacle course faced by those renting in today’s private sector.
Emily (not her real name) was having her hair trimmed in the chair next to me and was talking about her landlady’s decision to sell the house that Emily currently rents. Emily has been given the minimum notice period which in her case is 56 days but this is not a long time when you’re working full time and have 6 children attending 3 separate local schools.
Emily met her husband Carl five years ago, Carl was a single dad of three, Emily had two children of her own and they have since had one child together. Emily works full time and Carl works part time. They have been on social housing lists for the past five years but 4 bedroomed properties are few and housing rules state that they would be overcrowded in a 3 bedroomed house; they are also not deemed priority as they are not homeless – yet.
Their financial circumstances fit into Teresa May’s famous ‘Just About Managing’ group, however having to move will put them into serious debt.
I was shocked to learn that in order to get a rental property; tenants have to pay a range of fees that in Emily’s case come to just under £2000. These fees consist of £250 each in reference and application fees for Emily and Carl, (this is despite the fact that they had these checks done before their existing rental agreement, have never defaulted and are looking to rent from the same rental agency), Guarantor reference fee £100, Contract fee £50, Deposit Bond £725 and one month’s advance rent of £725.
If you’re reading this in London or anywhere south of Watford Gap you’re probably thinking that the month’s rent is a misprint and should say weekly or have a 1 or even 2 in front of the 7, but no, up here in Merseyside those are the correct figures.
For a family who are just about managing, finding £2000 for a move they weren’t expecting is going to be tough, they will have to borrow and they will not be looked upon as a good risk. Fortunately, I was able to tell Emily about our local credit union, hopefully she’ll be able to get a loan from them at an affordable rate of interest and not have to go to a payday lender or loan shark, but how many others are forced into penury through rental fees – particularly in the south of England where rents are astronomical.
In last year’s Autumn statement Philip Hammond announced that the government would look into the issue of rental fees and whether they are in fact a means of extracting money from those in unsecure housing situations – but in the meantime people like Emily and Carl continue to struggle.