Autumn statement: Letting fees are awful, and Philip Hammond is right to ban them

Chancellor Philip Hammond enjoys a private joke somewhere in the Autumn Statement. Image: Getty.

A tragedy, in one graph:

Isn’t that awful? Isn’t that the saddest thing you’ve ever seen? A universally adored brand like Foxtons, losing a tenth of its value in an hour off the back of one bit of bad news? It couldn’t happen to a nicer firm. Perhaps it’s time for the inaugural CityMetric Christmas appeal.

Or we could not do that, on the grounds that banning letting agents fees is a thoroughly good thing, and estate agents are awful.

The move, which chancellor Philip Hammond is announcing in today’s Autumn Statement, will bar lettings agents in England and Wales from demanding tenants pay whatever fees they happen to feel like. (Those in Scotland are already barred from doing so.)

Lettings agents do have costs, of course: reference checks, credit checks, repairing the deliberate damage passers-by do to those minis in examples of what are basically hate crimes. In future, though, they’ll have to recoup them through landlords, rather than tenants.

The whiny, kneejerk, “pro-business” critique of this policy runs as follows. Any attempt to interfere in the operation of the free market will necessarily harm the weakest participants in that market. If letting agents pass their costs onto landlords, landlords will in turn pass them onto tenants. Ergo, the real victims of any attempt to stop lettings agents from torturing tenants any way they happen to feel like it will be tenants themselves.

This critique is, of course, a steaming pile of horseshit, spread about by the sort of people who have no shame about publicly announcing that they’ve not thought very hard about this and probably aren’t actually that clever. For one thing it’s obviously ridiculous. They’re banning parasitical middle men from demanding hundreds of pounds with menaces from renters whenever they have to do some photocopying – and you think that will actually harm renters? Are you high?


But no, let’s be fair to them and destroy their argument using actual logic. Yes, lettings agents do have costs. But there is no evidence that the fees they charge reflect those costs. Occasional CityMetric contributor Alex Parsons put together a report on this, available on the website lettingfees.co.uk. He found that the cost of new tenancy agreements varied from £48 to £450.

Administrative costs clearly don’t vary by a factor of 10: some of those letting agents are charging inflated fees, not because they have to, but because they can. By the time the fee is due, most tenants will have committed to their new home: the agents have them over a barrel. They’re price-gouging, and they should stop.

But there are legitimate costs, of course. Won’t these be passed onto tenants in higher rents? Very possibly – because, while the availability of property won’t change, the availability of money to pay for it will.

Even this is no bad thing, though, since at least they will be passed on consistently. At the moment it’s impossible for tenants to compare the real price of a new home, because are not shown in the advertised rent. Banning letting fees will introduce a much needed measure of transparency to the market.

There are other benefits to a ban. The added costs are likely to be more managable if paid as part of the rent, rather than in a single, upfront lump. It also means an end to unpredictable extra fees, when individual tenants leave houseshares or contracts otherwise need amending.

But if you’re still not convinced, there’s one more way you can tell that the real victims of this policy will be estate agents, rather than tenants. It’s this:

There is a reason that has happened: investors think this policy means that less money will now be going to Foxtons.

It’s a tragedy. A real tragedy, I tell you.

Jonn Elledge is the editor of CityMetric. He is on Twitter, far too much, as @jonnelledge.

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A helpful and informative guide to London, for the benefit of the New York Times editorial board

The sun rises over quaint old London town. Image: Getty.

It’s like with family members you hate: it’s fine for you to slag them off, but if anyone else has, you’re up in muted, backhanded arms about it.

Yesterday, the world’s number one London fan the New York Times tweeted a request for experiences of petty crime in the city. This was met by a deluge of predictably on-brand snark, like “Sometimes people scuff my leg and only apologise once”, and “Dicks who stand on the left-hand-side of tube escalators”. This served the dual purpose of uniting a divided London, and proving to the NYT that we are exactly the kind of chippy bastards who deserve to constantly lose their phones and wallets to petty crime.

By way of thanks for that brief endorphin rush, and in hopes of leading things in a more positive direction, I’d like to offer the Times this uplifting guide to London, by me, a Londoner.

I take my London like I take my coffee: on foot. If you are with someone special, or like me, like to reimagine your life in the format of Netflix dramady as you walk alone on Sundays, I can highly recommend the Thames Path as a place to start.

Kick things off next to Westminster, where we keep our national mace in the House of Commons. Useful though the mace might prove in instances of street theft, it is critical that it is never moved from the House. It acts as a power source for our elected representatives, who, if the mace is moved, become trapped in endless cycles of pointless and excruciatingly slow voting.

Cross Westminster Bridge to the Southbank, where in the manner of a spoiled 2018 Oliver Twist, you can beg for a hot chocolate or cup of chestnuts at the Christmas market for less that £8. Remember to hold your nose, the mutton vats are pungent. Doff your cap to the porridge vendor. (LOL, as if we make muttons in vats anymore. Box your own ears for your foolishness.) Then buy some hemp milk porridge, sprinkle with frankincense and myrrh, and throw it at the pigeons. There are thousands.

In the spring, head a little further south through Waterloo station. If you pass through the other side without getting ABBA stuck in your head, Napoleon’s ghost will appear to grant you three wishes.

Proceed to the Vaults, which is like the rabbit warrens in Watership Down, but for actors and comedians. No-one knows the correct way in, so expect to spend at least 45 minutes negotiating a series of increasingly neon graffiti tunnels. Regret not going to art school, and reward yourself upon your eventual entry with a drink at the bar. Browse the unintelligible show programme, and in no circumstances speak to any actors or comedians.

When you emerge from the Vaults three days later, turn back towards the river and head east. Enjoy the lights along the Thames while you pick at the spray paint stains on your coat. 


After about 20 minutes, you will reach the Tate Modern, which stands opposite St Paul’s Cathedral. Close to sunset, the sky, water, and cathedral might turn a warm peach colour. The Tate remains grey, coldly confident that for all its brutalist outline, it was still fantastically expensive to build. Feel grateful for that loose knit jumper you stole from the Vaults, and go inside.

Spend two minutes absorbing the largest and most accessible art, which is in the turbine hall, then a further hour in the museum shop, which is next to it. Buy three postcards featuring the upstairs art you skipped, and place them in your bag. They will never see the light of day again.

Head further east by way of Borough Market. Measure your strength of character by seeing how many free samples you are prepared to take from the stalls without buying anything. Leave disappointed. Continue east.

At Tower Bridge, pause and take 6,000 photos of the Tower of London and the view west towards parliament, so that people know. Your phone is snatched! Tut, resolve to take the embarrassment with you to your grave rather than shame Her Majesty's capital, and cross the river.

On the other side of the Bridge, you could opt to head north and slightly east to Shoreditch/Brick Lane/Whitechapel, where you can pay to enjoy walking tours describing how some pervert murdered innocent women over a century ago.

Don’t do that.

Instead, head west and north. through the City, until you reach Postman’s Park, which is a little north of St Paul’s, next to St Bartholomew's hospital. Go in, and find the wall at the far end. The wall is covered in plaques commemorating acts of extraordinary and selfless bravery by the city’s inhabitants. Read all of them and fail to hold back tears.

Then tweet about it.