This is the reason why letting agent behaviour, hidden fees, discrimination, poor customer service etc. is so rife, and indeed why these behaviours are rarer in areas where supply and demand for homes is in better balance.
The relationship between agent and landlord on the other hand is vastly different. The landlord holds the home and agents are many in number, requiring no great skill and no qualifications at all. The agents have to compete with each other to win a monopoly over the tenancy of a landlord’s property.
So agents won’t be able to hike up fees to landlords because the landlord will just go to a cheaper agent. This will lower agent fees until they are more reflective of their cost base, at which time they will have to start competing on other grounds, such as professionalism and customer service.
By banning letting agent fees to tenants, less money will go to agents that’s true. But landlords should expect lower costs and a better service as the effects play out. And more professional agents will be of benefit to tenants beyond the absence of exploitative fees. In fact, if this were implemented quickly and the market effects on agents flowed through quickly, that could radically undermine the case for mandatory licensing of letting agents.
This is such a classic market solution to a social problem that I’m surprised it’s not Conservative policy.
So like I said, it’s supply and demand.