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New agency fees deal for tenants

Tenants will be able to shop around for the best deal under Government proposals to make letting agents publish their fees in full, Nick Clegg said today.

The Deputy Prime Minister said "full transparency" would be required of agents as he warned that Labour's measures could result in higher rental costs.

The Opposition has proposed a ban on letting fees for tenants and three-year standard tenancies with predictable rent rises.

Asked by Labour's deputy leader Harriet Harman if he would back her party's plans, Mr Clegg replied in the Commons: " I think you make an important point about virtues of longer-term tenancies and that's why we're working on a model tenancy agreement that will support tenants and families who wish to seek a longer fixed-term tenancy and will publish the final agreement in the summer.

"On the charges raised by the agencies, I think while the problem you identify is right, I think the solution you are suggesting may lead to higher rental costs for people who are renting properties.

"That's why we'll be announcing today that will be placing new obligations on agents to publish in full transparency what kind of fees they are charging so people can shop around and get the best deal available to them."

Ms Harman dismissed the idea, telling Mr Clegg the transparency proposal was "not good enough".

She said: "What we need to be sure is letting agents don't rip tenants off by as well, as charging the landlords, charging the tenants.

"There's a vote in this House today. Will you vote with us to protect those people in rented accommodation or will you back the Tories in standing up for the rip-off letting agencies?"

Mr Clegg replied: " We share all your concern about those charges, we just want to make sure that the solution doesn't make the situation worse because when rents go up, they tend to stay up."

Mr Clegg said the "fundamental problem" was the lack of affordable houses built, telling MPs that fewer social homes were built under the last Labour administration compared to Margaret Thatcher's.

He added that the rate of affordable house building is now higher than it has been in the last 20 years.

Labour is to challenge the Government to back a ban on expensive letting agent fees by forcing a vote on its plans in the Commons today.

The Opposition has tabled an amendment to the Consumer Rights Bill aimed at tackling the fees, which average about £350 but can be much higher.

Labour said the fees were a major difficulty facing "generation rent" as they found it difficult to cover the cost each time they need a new property.

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