Landlords and letting agents in Wales face a ban on charging tenants upfront fees as a new law passes the final hurdle.

Members of the Welsh Assembly voted in favour of the ban, which is awaiting Royal Assent and is expected to come in to force in the autumn.

The ban will stop letting agents and landlords from charging fees connected to granting, renewing or continuing a tenancy agreement.

The law will also introduce a cap on holding deposits set at a week’s rent and place a limit on security deposits which has yet to be revealed.

The only charges landlords and letting agents can make under the Renting Homes (Fees etc.) (Wales) Bill will be rent, security deposits, holding deposits, utilities, communication services, council tax, green deal charges and default fees.

A similar ban starts in England from June 1, while landlords and letting agents in Scotland have faced a ban on fees for some time.

Research for the Welsh Government found that 51% of fees reported by letting agents were between £150 and £300.

Although assembly members fear rents may rise due to the ban, housing charities have welcomed the new law.

Welsh local government minister Julie James said:

“Those on low incomes, have been at the sharp end of letting fees.

“The bill re-balances the relationship between tenant, agent and landlord, removing any doubt about what costs need to be budgeted for when renting.”

Meanwhile, Lindsay Cordery-Bruce, from homeless charity The Walllich said:

“Extortionate agency fees prove a major barrier to accessing housing which ultimately leads to a higher risk of homelessness and a lack of realistic move-on options for those in temporary or supported accommodation.

“This, plus a lack of suitable housing, is one of the main reasons why we have a homelessness crisis at this present time.”