Are letting agents breaking the law on fees?

by , Senior Policy Adviser Consumer Rights 5 March 2013
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We’ve just mystery shopped letting agents and found that many aren’t being upfront about their fees. We think they’re breaking the law – so how are they getting away with it?

A picture of a house on a chalkboard

Buying a property remains out of reach for many, so renting has become a fact of life for millions of people. In fact, rental properties currently provide homes to more than 4.7m people in the UK.

When we investigated letting agents last year, we identified upfront fees as one of the biggest concerns for renters. So we’ve undertaken a mystery shop of four branches each of four different agents in London – Foxtons, Barnard Marcus, Martin & Co and Your Move – to see if they were upfront about the fees tenants could expect to face.

Letting fees are clear as mud

Our snapshot research at these letting agents revealed some worrying results. For a start, none of them provided information about fees in any property listings on their sites, on Rightmove.co.uk or after tenants had registered online.

Out of all the branches, only one agent at one Foxtons branch proactively gave fee information to a customer who registered at their branch or called to arrange a viewing. On top of that – not one of our mystery shoppers was provided with a written list of charges.

But even more worryingly – in some cases, our shoppers were either not given fee information when they asked for it, or were not given the correct or complete details.

So how can potential tenants hope to shop around for a letting agent when it’s made so difficult to compare fees? Ultimately, tenants could be vulnerable in this situation – particularly in competitive rental markets like London’s. After all, once you’ve found a property you want, you’re unlikely to let it go, even if it means paying-up for expensive fees.

Unfair and unlawful

As far as we’re concerned, the lack of transparency with letting agents’ fees is not just bad practice – it’s unlawful. We believe that the current failure of letting agents to show fees upfront is a breach of Consumer Protection Regulations, because they are not providing material information in a manner that is clear and timely.

So we’ve written to the four agents listed above to share our findings, demand improvements, and remind them of their legal responsibilities. We want to see increased transparency and an end to hidden fees as we think tenants deserve much better.

Have you had any bad experiences with letting agents? Was your agent upfront about its fees, or did you find yourself facing a hefty bill when you came to sign the contract?

75 comments

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contractor

its not just tenants who are in the dark about fees.
i work as a contractor doing maintenace work to tenanted properties.
unkown to landlords these agents also charge contractors a introductory fee for finding them work at the properties rented out by them on the landlords behalf. this fee is between 10% & 20%. on both labour and materials. depending on the letting agent.
this fee never shows up on the landlords invoice because of the clever way the agent pays the contractor to conceal their greed.
so come on which dig a little more and expose this scam as well.

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James

That is quite an inflammatory statement. I have worked in the industry for 17 years across over 8 different agents none of which added monies on to contractor invoices. While I am sure some do, your blanket comment is basic stereotyping.

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Disgruntled contractor

I am also a contractor and am deducted 10% from my invoices, Is this legal or is it just frowned upon within the industry? I have aways been a tad miffed as the agent is already being paid to look after the properties and why should I have to pay them as well, No doubt it would be explained away as admin fees, Nice to know whether I could claim it back,,,

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John Ward

In previous housing market downturns estate agents have gone to the wall or rationalised by closing branches and laying-off staff. The massive increase in the private lettings market has effectively sheltered estate agents, the inferior ones especially, from the harsh economic rigours of their trade. In fact they have prospered, since landlords are buying properties and then engaging agents to let them so they make a turn on both sides of the coin. I have no grudge about that as it demonstrates proper commercial astuteness and entrepreneurialism. But, as a consequence, some have become arrogant, exceedingly self-interested, and intensely mercenary. Culturally, estate agents have always been extremely sensitive about their fees [in selling transactions they hide behind percentages and arrange for their fee to be paid by the conveyancer and put on their bill so you never really get to appreciate how much you are paying for the agent's often feeble performance]. Now they are being secretive in the lettings market, where there is not the comfort cushion of a mortgage and where their customers are often not in such a strong financial position as sellers. “Contractor” above has made a good point about the way agents lick the cream off repair and maintenance work; this is not in the best interests of either their clients [landlords] or the tenants who end up with a lower specification of work since contractors do ultimately need to price this skimming into their bills. The four agents tested by Which? are probably just the thin end of the iceberg, and probably not the worst agents overall [albeit some of the sharpest].

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Anon the mouse

If you think agents fees are bad wait until you have to fight over deposit returns. They regard it as THEIR money and will add fees on fees on fees to try and claim it all as theirs.

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Anon the mouse

Here’s what happened with “fees” and deposit issues with my former landlord and agent

The agent eventually wanted over £300 which is abit different from their original £60. And funnily enough it only went up when I disputed the checkout list.

My deposit dispute lasted for almost a year, it included attempted fraud by the agents, fees magically appearing, and an ever changing checkout list. On top of the usual never in agent dealing with it. In the end I doorstepped the Landlord and gave her a letter detailing the agents failings and the threat of legal action (benefit claimants get fee relief on small claims, so no loss). I also doorstepped the agent dealing with my case at their head office, funny how they were always available on the phone after that,
All the doorstepping did mean that I organised a meeting between all parties and when it seemed to be heading nowhere pulled out the completed small claims paperwork and asked if court would be better all around. I even offered to file as I don’t pay fees… Apparently CCJ’s really screwup buying property so the landlord was suddenly very receptive.

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James

Really, this is what your agents wanted? Contrary to popular belief most agents dread protracted and emotive fights over deposit returns. That role in management often has the highest turnover of staff. It’s an amazingly convenient scenario to paint the agent out as the bad guy. But as I am sure has been pointed out, an agent acts on behalf of the Landlord. Who do you think is actually asking for the deductions to be made? If you don’t like the amount your letting agent is proposing why not write to the Landlord directly. You are entitled to his/her address by law.

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Trudy M

We as landlords, have been charged a hidden admin fee of £250 + vat to release the deposit back to the tenants. When I contested this fee we were threatened with court action as we had initially (stupidly) agreed, by email,for the invoice to be sent to ourselves. The fee is reportedly for bringing the records out of archives and processing the release. As we inherited the tenants on purchasing the house, we hadn’t signed a contract with them but agreed, on a good will basis, to allow them to stay until the end of their contract.
We need to see a change in the law to make these unscrupulous agencies accountable.

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Dan

It’s true about getting your deposit. They will try anything to hold onto money that they think is theirs. I had mine withheld from me due to a baking tray being “scratched”. In all honesty though I wouldn’t have a clue what the fees are for but I don’t expect anything differently from letting agents.

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Anon the mouse

Ask for a clear breakdown and when they put “admin fees” ask for a breakdown of that.

There is a difference between a fee (actual cost + small profit) and a penalty (disproportionate cost), one is legal the other isn’t. If it’s over £20 ask for a breakdown, don’t be afraid to stand your ground. And use their own stuff against them. Use the land registry to get the actual address of your landlord too. Grab a smalls claim pack from court and fill it in. If you get nowhere you know you can file it, and serve the landlord by hand. CCJ’s do scare private landlords as they can’t buy more property easily.

When I took out the lease on my property, I asked at the beginning exactly what fees I’d be looking at. It was all very confusing – they told me I’d pay a deposit of 6 weeks rent, a month’s rent in advance, referencing fees and a ‘checkout fee’ in advance of moving out.

But then, after we agreed to take the property, they asked us for a ‘goodwill’ payment of £200 to hold it. At this point, we’d already paid for referencing (more than £200) – a gesture enough of our willingness to move in, I believed. They couldn’t explain to me why I needed to pay this £200, so in the end I refused and nothing much came of it.

Now I’m trying to exit my contract early in order to buy a property on which we need to move fast. I assumed there’d be an exit fee – which was quoted to us at £500 for a remarketing fee (to advertise for new tenants) and £50 administration fee. Later that same day, I received a call saying that the fee would in fact be £150 for admin. After a string of mixed messages, I’m thoroughly frustrated and frankly, distrusting of my agent.

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Anon the mouse

As I said to Dan above anything over £20 in fees ask for a proper breakdown.
Saying £150 admin and proving £150 admin are two completely different things.
You said that you paid for your own referencing so they cannot include finding new tenants in the fee as prospective tenants pay for themselves. Anyone can pull a figure they’d like to receive, proving it is another matter.

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James

I presume you mean you wish to break the contract early and these are the fees being levied to allow you to do so. The Landlord is under no obligation to allow early release so you can either remain in the property for the fixed term and pay no fees or leave early and pay towards the landlords costs for finding alternative tenants.

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Arnie from Newington

It is industry standard not to advertise agency fees.

However this is not done to conceal information from tenants (who would be told about any fees prior to reserving a property). The reason that fees are not advertised as it may upset landlords who would feel that these fees should go to them or be waived to encourage people to rent their property.

Most landlords would not have a problem with the agency charging these fees however there will always be some landlords who get upset so it is better just not to advertise these fees.

I read the link to the relevant legislation and feel it is a subjective matter as to when a law is broken regarding the timeliness of the disclosure of fees for an agent.

It does though seem that a lot of organisations are currently gunning for letting agents and the issues that are appearing in the press are not new and not that important.

I think the end game for these organisations is more regulation of letting agents and a ban on agency fees for tenants (already happening in Scotland).

More regulation means less more expensive agents (bad for landlords) whilst a ban on agency fees will just lead to higher rents (already happening in Scotland) which is bad for tenants.

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wavechange

Annie

You say that it is industry standard not to advertise agency fees. If letting agents are receiving criticism then honesty and transparency might help.

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James

This is slightly misleading. It is industry standard but is more about protecting the business from unscrupulous competitors rather than an attempt to mislead applicants. Any professional business will put in all the hard work to match a tenant with a property only for another agent who has done nothing try and poach the applicants by undercutting fees at any cost. It is exactly the same reason agents will rarely give out fees to a potential Landlord. There will always be an agent working on the basis of undercutting any other agent.

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Arnie from Newington

I am very much in favour of honesty and transparency however I think the bodies attacking letting agents have an agenda. I think publishing fees on the website would not appease the critics just as the tenancy deposit legislation hasn’t appeased the critics.

The mystery shopper nonsense makes it sound like letting agents are doing something underhand when letting agents are not hiding that they charge fees.

Given the amount of work involved in letting (far in excess of selling) fees are very low and I would remind which of the difference between an offer and an invitation to treat.

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wavechange

I am not surprised there are critics. Are you happy to buy goods and services without knowing how much they cost? I’m not.

Thankfully, I don’t think I will ever have any dealings with letting agents.

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Arnie from Newington

You are misrepresenting my position nobody is asking anyone to buy something without knowing the cost.

The issue is about timing of the information regarding costs rather than trying to conceal information.

Hi Arnie, part of the problem is that our research found that even when our mystery shoppers asked for information on the fees, at times it wasn’t given (for various reasons, such as the agent on the phone ‘not knowing’), or when it was given, it was given inaccurately.

All of this considered, it can be very difficult for potential tenants to know where they stand.

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wavechange

Arnie – My apologies for getting your name wrong.

You claim you are very much in favour of honesty and transparency, yet the industry wants to delay providing information. Please don’t take my comments as a personal criticism. It’s the industry that needs to sort itself out.

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kind landlord

I am a landlord and I always try and look after my tenants as I realise that finding the rent money every month is a big burden for many people. I have been paying a considerable amount of money to Lettings agents for many years, but I had no idea that tenants had to pay any money at all,until my daughter rented a Flat! Wow!! What a shock….the Lettings agents are getting fees FROM BOTH SIDES!!!….Pure greed!

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Arnie from Newington

Kind landlord

You have my sympathy, when I play football manager I am always annoyed that I have to pay a fee to a players agent to sign that player. I am sure the agent is taking a fee from the player as well.

But seriously charging both sides for services provided is what agents/middle men do (not just letting agents) it is not unusual just life and nothing to do with greed.

Jennifer

As I said before I am not impressed with the mystery shopper excercises that are being carried out. I feel to take such a small sample and extrapolate it misrepresents the true picture. If you went to a football match and the person you sat next to was a racist would you then conclude that all football fans are racist?

We have had mystery shoppers to tell us that letting agents charge fees for referencing in Scotland, mystery shoppers to tell us that letting agents do not accept DSS tenants and now mystery shoppers to tell us that letting agents do not put their fees on websites. Soon we will have mystery shoppers to tell us that the sky is blue and that bears go to the toilet in the woods.

Wavechange

Thanks for your message however I confirm that I took no offence from your comments nor do I mean to cause offence to others it is all just opinions and mine is no better or worse that anyone elses.

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Tony

It is interesting to note that the “mystery shop” involved what I would like to think of as well known reputable agents. As a letting agent I am often made aware of less scrupulous back street agents who are quite simply out to rip people (landlords as well as tenants) off, most of whom have no qualifications, little or no experience, no consumer protection and in some cases end up running off with clients money. Which should perhaps concentrate their efforts at this ector of the property market. We do charge what we consider a modest application fee of £195 per property application (to include all prospective tenants). We refund it if the application does not proceed through no fault of the applicant. We do not charge inventory fees, renewal fees etc. Without such a fee we would be subject to considerable messing about by applicants who may submit numerous and ultimately aborted applications on various properties, wasting our time, incurring costs and delaying lets for landlords, who don’t forget are also consumers.

I also note that on the Which website I have the chance of a “Trial” subscription at £1.00 but at that point it does not tell me what my future subscription commitments will be and that they will continue until I cancel. People who live in glass houses…………………….!

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wavechange

One click will provide the monthly price of Which? Magazine and one further click will provide all the information needed about subscriptions.

Thanks for the feedback Tony. On the subscription page if you click ‘full details’ at the top of the page you’ll see: ‘You pay £1 for your first trial month. After your trial month has passed, payments of £9.75 (including VAT) will be automatically requested monthly.’ More importantly, before you choose your payment method it says ‘You’ll only pay £1.00 for your first 1 month. If you continue your membership after the trial, you’ll pay £9.75 per month. You can cancel at anytime.’ I hope that helps.

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Tony

Yes – but why not show that information with the initial offer as letting agents are being required to do?

Surely the same principle applies along with lots of other instances of advertsing – it is after all only an “invitation to treat” as has been pointed out.

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wavechange

I certainly agree about the price. Normal price and offer price can very easily be shown together, and always should be.

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Louisa Darian

Hi Tony

Thanks for your comments. We do appreciate that there are many good guys out there and this is just strand of our work on letting agents. We are also working to try and get legislation that applies to estate agents extended to cover lettings, to help level the playing field for the 60 per cent of agents that are currently operating good practice by being a member of an approved scheme. We had some success in the Lords last night – you may see news of this in the media.

In relation to fees we are not calling for a ban on fees, just transparency. We also think that these are very different types of transaction, and our trial customers are provided with information on the renewal terms before they sign up

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Tony

Glad to see that you recognise some of usaim to be fair.

Interestingly no comment on the Which? Trial pricing though!

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Tony

Which? seem to be missing (and hopefully not avoiding) my point. If they feel that letting agents should divulge ALL fees etc at the very first point that the consumer sees the information, WHY do they do not do so themselves? Further details of costs etc are not revealed until the second stage in the process which is what most reputable letting agents do already.

Many a time I have been tempted by such offers only to back off when the detail and comitment is revealed further down the line.

Thanks for the comment Tony, I’ll pass on your feedback.

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Melissa

Tony, I think you’re the one who has missed the point here. Which? actually do show you quite clearly that it’s for a trial period unlike estate agents who never at any point show you costs, whether that being upfront on their websites or when asking. What you were looking at is called an ‘advertisement banner’ and shows the initial offer, when clicked on it will then take you to a page disclosing more details of the offer. When looking for flats to rent no matter how many times I clicked on places for rent I was never taken to a page that showed any fees. I think maybe you should invest in the Which? guide as it might prove to be useful for someone like yourself.

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Tony

You would (rightly) hang us out to dry if we offered a property on something like Rightmove at a “trial” rent of say £200 pcm without mentioning at that first point that it increased to £2000 from month 2 onwards!

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Steve

I have several gripes:
I want to rent a flat, and live in it with my (unwaged) wife. Why do I have to pay for a credit search etc. for her (quoted at £200 [ the same as for me]) when I would be the (only) one paying the bills?
How can agents justify fees of this level when (admittedly as ‘individuals’) credit records are available on-line so cheaply?
I was also quoted £300 as a fee, (non-refundable of course), to take the flat ‘off the market’ while my application was processed.
Outrageous!
I understand we need agents (in some form), but, at the moment, they are cynically making money out a commodity people cannot do without; a place to live!

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Tony

As an agent I agree with Steve entirely. I suggest that he chooses to rent through an agent that will not rip him off. He might also lobby his MP to introduce mandatory licensing of letting agents, as the professional bodies concerned have been pressing for for some time, which would allow this sort of practice to be controlled.
I cannot understand why successive goverments have failed to take this up although it has to be said that it is pointless if they do not penalise any firm not complying, as seems to be the case with EPC . HMO and Tenancy Deposit rules!

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David S

Countrywide, now Bridgfords, during a gap between my tenants, transferred my electricity supply to another provider (E-on) without any permissions. They get a discount for doing so. In a respoonse to my complaint they indicated that the previous tenant did not object. You bet they didn’t, because they weren’t asked – they had already left. And I was certainly not asked,.

I now have a new and patently more honest agency – though left stuck with E-on!

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Jeff

I rented with Countrywide some years ago, never again. One day it rained like a monsoon, the brickwork at the front of the house was loose and the rain literally found its way through and flooded half the living room carpet, that is fact. I mentioned this for weeks and weeks to Countrywide, who did nothing whatsoever. Fortunately for me, it was at the end of my tenancy and I left, but I should have been reimbursed for my grief. Had this happened at the beginning of the tenancy I dread to think of the torment I would have had.

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Mrs H.

Like the earlier landlord, I had no idea that “fees” are charged to tenants. (I was a landlord for some 14 years). It is reasonable, I suggest, that there is a charge for seeking refs, but that should be a clear, standard charge, from all agents, not variable according to what the agents think they can get away with. It is also, in my (London) experience, the practice for landlord and tenant to share the costs of an in/out inventory. Usually the landlord pays the “in” and the tenant, the “out”. That should be in the contract. The charges are likely to be a bit varied, as different inventory practitioners charge different rates. Agents tend to recommend the same inventory clerks, so should be able to indicate to both landlord and tenant, the probable cost. But these should be the only charges levelled at a tenant. The landlord pays an absurd fee to the letting agency, (mostly only for the introduction of the tenants and a contract, so the agent is on to a nice little earner! These fees and arrangements should be covered by statute. I hope that Which? will give these points serious consideration and include them in their representations to government.

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Paulo

I have only come across one letting agent that was upfront about fees in another town.
Our family was in a vulnerable position when doing the last letting and the agent was fairly opaque about fees, which then looked clearly setup to soak up any optional expenses that they themselves would advise the landlord to not incur. They also forced a longer notice period from the tenant side.
We still went with them as the only other agents in the village are worse, delaying viewings until they have several so they try to make it difficult for tenants to negotiate any maintenance required.

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Paulo

Actually I just saw other people in the forum had the same problem.

So to add, I found that the reference fees are very variable from agency to agency and can run into hundreds of pounds. They get as many adults as possible to go through it so they get as much fees as possible (even when they can tell that the tenants do warrant them). If they then manage to make it into a simpler security check, the fees are still the same. This is clearly setup as a scam (if it wasn’t, they would be clear upfront about credit check fees and distinguish them from contract drawing fees).

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James

I am not sure I understand your point. Usually any occupant over the age of 18 will be referenced. This is to avoid issues in future when name tenants vacate and occupants remain in the property causing all manner of difficulties in recovering possession.

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carole noble

I think the fees are outrageous, my daughter left halls in London last year and took a rental with 3 friends. The fees charged for check upon check of them and for various other stuff that the agent claimed they needed was ridiculous. It put hundreds on their deposits and bonds required which was to me an absolute rip off.
All in all agents know that students have to have accommodation at the end of the day, and therefore its a like it or lump it scenario. The accommodation is more than often nowhere in line with what they charge, and trying to get things done is virtually impossible such as repairs etc etc. It is about time that more regulations were introduced and a sealing on what can be and cannot be charged made legal.

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A Gregory

Please make sure that when your student children move in that you take lots of photographs of the condition of the property AND any furniture and white goods. When they leave make sure that you repeat the process thoroughly. As sure as eggs is eggs the letting agent will automatically deduct an amount from the deposit, usually at a level where you are not sure that it is worth challenging and they must make hundreds of thousands from this wheeze. Letting agents were trying to charge my daughter and her friends for damage and graffiti which had obviously been the same for years, cleaning (which I think is the landlords responsibility and surely factored into the rent), which in this case was unnecessary and for leaving items in the fridge that had to be thrown away (they hadn’t). Because of all the photos we felt we had good evidence of their sharp practice and they refunded all the money (after the threat of legal action). I think they send out the same letter each year to all the tenants who are moving out. No doubt they are not the only ones.

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Simply Rent

We are a Residential Letting Agency based in the north west of England and have been operating for 20 years. We have never charged tenants any fees for renting a property and have been appaled by reports of fees charged by other agents. If an applicant makes a false statement on an application form we make a small charge (£25) but otherwise our application and referencing process is entirely free of charge to tenants. Neither have we ever accepted money for accepting contractors onto our register and nor do we add any mark-up to contractors bills for work which we arrange. As an established Letting Agency we would be delighted to see regulation or legislation to force all such fees and charges to be declared up front.

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jamespreston

You should open some branches in the South East. With business ethics like that, you would make a killing :)
I have rented for many years and the agents have always charged numerous fees to the tenants. Your post is a breath of fresh air.

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Mrs B

I have been a Landlord for 15 years and I am also appalled at the fees these agents are charging.
I have just had the misfortune of using YourMove Lettings and believe me when I say I will never ever use them again. Apart from the fact I had to pay a huge amount for just “Tenant Find” only service (twice as much as a previous agent) plus an additional fee for them holding the Bond. I was £7 short and they refused to sign the new tenant until I had gone to the office to make a debit payment – cheques not accepted or payment over the telephone. They have added a clause to my tenancy agreement, without discussion with me, that all gas & electricity supplies for the new Tenant have now to be with Spark Energy Ltd., My Tenant, although having spoken to Spark Energy, agreed not to move to them have still gone ahead and taken over the supply. Where do I come in this as I own the property and all previous Lettings agents have put clauses in that my tenant has to ask permission from me before moving the supply. Furthermore they have written that if I do not use YourMove to arrange the next Gas Certificate I will have to supply them with the Original copy that I get. I asked for Tenant find not Management of any kind so who the hell do they think they are – Over my dead body – is the answer. LANDLORDS AND TENANTS BEWARE OF THIS UNSCRUPULOUS COMPANY – How do they get away with this and when will there be some legislation about these robbers?

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Mrs B

I might also add that I have found this “Company” charged my tenant a £300 Fee. What the hell is going on with these greedy Lettings Agents. Obviously I am not using them to manage my property I want my tenants to have better care than this and in future I will not ever again use such a letting agency.

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James

Your tenants have the right to change their utility supplier. You are correct that once upon a time a Landlord could insist that suppliers were not changed however this was remedied with the Unfair Terms in Contracts legislation set out by the OFT.

While Your Move appear to have been a little bullish, for every Landlord that will pay monies owed there are several that wont. In the case of a find only service it proves virtually impossible to recover monies from a Landlord.

In terms of the commission fee, presumably you chose to instruct Your Move.

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simon whaley

I have posted many times in forums and tenant groups about this ,however Which? Has had a very innovative approach here basically using the ASA rules and I hope this is a way forward following resistance from the government on this .
The two major portals could impose regulation on the letting agent industry if they so wished by making all fees involved in a tenancy mandatory with the property listing ,Rightmove and Zoopla are quite cold to this idea as they think wrongly it will damage revenue
I am sure licensing will be in place very soon and as a landlord would welcome it as it is not just an issue for tenants but everyone in the PRS.
As with everything there are always shades of grey ,I have been giving some thought to the increasing number of online or DIY letting agents ,when licensing comes in how do these businesses regulate the fees that are charged by landlords for whom they only offer an introduction service? Or if there is a published scale of fees from each landlord on their listing and a differing sum is charged to a tenant who is legally responsible the online letting agent? Rightmove?
Does this spell the end of online letting agents who do not control the whole process from application to handover?
Simon Whaley
Private Landlord Directory

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eric

We are about to leave a property and have been handed an invoice for a “Check Out Fee” this was never mentioned at the beginning of the lease, and has never happened in the past. Also they now say you are not allowed to hire carpet cleaners and have to use a “professional cleaner” this is also different from when we moved in. Does anyone know if this is legal?

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James

You are only obliged to adhere to the terms of the Tenancy Agreement you signed. If is specifies that you are responsible for the cost of the check out then you are.

It is not unusual for a professional clean to be required, however it should only be required if the agent/Landlord can demonstrate it was professionally cleaned prior to you moving in. Why not ask for some evidence?

If you are obliged to carry out a professional clean then hiring your own equipment is unlikely to be acceptable no matter how capable you are.

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Claire

Although James – ok – but she should know what the details of the fees are though!! – if they arent open and transparent about what the fees are in the first place. i.e. how much or where to find how much these are!

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GEORGE ATHANASAKOS

We are a family of four , went to London to find to rent a property , what all agencies required us where 500 pounds to reference – credit check all of us !!? Why do they credit/reference check family members – 18 year old boys and housewifes with no income or credit reference history and dont follow what they do in rest of Europe to have a lead tenant in such situations ? More specifically they asked 500 pounds for these checks + 200 pounds for admin fees + 150 pounds for inventory fees + 100 pounds for check in fees. SHAME ON THEM THAT THEY ARE TRYING TO STEAL THE MONEY OF HARD WORKING FAMILIES AND SHAME ON THE UK PARLIAMENT THAT DOESNT PROTECT THOSE FAMILIES !

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New tenant

I am in the process of moving into a new rental place and the agents fees are going to be £724.93 plus vat £144.99 gives a whopping total for administration and referencing fee of £869.92!!
This seems very high, but what can you do when shopping around would mean shopping around for a whole new property and this is the one that we like? They have you cornered.

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L Hurd

I recently competed a credit application for a rental property and was successful, unfortunately fater waiting almost 4 months the property became unavailable . The agency refunded my deposit and told me the credit check fee £238.00 would not be refunded as the credit checks had been carried out and this was the fee for the service. The manager of the agent proceeded to advise me that it wasnt his fault the house had fallen through and I wasn’t entitled to have a refund. Completey distraught and upset ,I am now £238 pounds down and now have to find some where else to live.
If any body can give me advise if I am entitled to a refund I would much appreciate it. Many thanks

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Louisa

Sorry to hear that L. I would check whether the agent is a member of the Property Ombudsman – you can go onto their website and check. If they are then take it up with them. There is nothing really stopping an agent from taking some of the money from your holding deposit but the ombudsman may find that the amount was disproportionate. Good luck!

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jamespreston

This is a rant about Seekers letting agency in Maidstone.
I rented a property on a 6 month fixed contract and paid the usual extortionate fees up front for credit checks etc… When the time came to renew the contract I was given the option to renew for another 6 months for a fee of £82.25. In order to reduce the amount of fees, I asked if I could renew for 12 months and was told that this was no problem but that the renewal fees would be £164.50. I cannot understand how a different end date on the contract could possibly justify doubling the fees. When I rang up to challenge, the reason that I was given by the helpful manager was “What can I say? We’re all in this to make money, love.”
I then decided not to renew and just allow the tenancy to default to a statutory periodic tenancy. I was then charged the same £82.25 for this renewal and, following a request for a breakdown of this fee, I was instructed that it was for all of the general admin in the renewal of the tenancy and re-registration of the deposit on a periodic basis.
I challenged this fee only to find that it was held back from my deposit when I checked out of the property a year later.
Practices like this by agents like Seekers, helps proliferate the negative image of letting agents across the board.
I also applaud Simply Rent who posted here for their practices – outstanding and showing how it should be done.

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Helen

I’ve just expressed an interest in renting a house with two friends and we’ve been sent the breakdown of fees. £519 admin fee + £113 reference fee + £120 check in and out fees. That’s £250 each before the month’s rent in advance and 6 weeks deposit. I spoke to another agent last week and they had a flat fee, no hidden extras of £90 per person. How can they be allowed to have such wildly different t&c’s. It’s so unfair. Is there any way of negotiating with an individual agent to take away some of the admin costs? It’s criminal to charge so much.

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Louisa

Hi Helen

Unfortunately your experience is not uncommon! The research we did found that fees averaged about £250. However, as you say fees do vary significantly so its well worth checking these when looking at properties. You have nothing to lose from negotiating, but just be aware that as the tenant you probably have less flexibility to do this than the landlord. One of the things you might want to do is ask for a breakdown of the actual admin fee.

Good luck!

Louisa

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Helen

Hi Louisa

Thanks for the advice. I’ll see what they come back with. It’s such a massive cost to pay and if you’re unlucky like we’ve been and have had to move every 12 months for the last few years due to private landlords wishing to move back in or renovate you can understand why I’m so upset by these huge fees. I worked out our moving costs last year and this year they’re £220 more. It’s just too much.

Can we do anything to get agents across the UK to set a standard fixed rate charge?

Helen

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Helen

This is the response I received when I asked for a break down of admin fees.

“The fee is the payment for our administrative teams work in preparing and drawing up the legal documentation for the shorthold tenancy agreement between yourself and the landlord. In this, of course the landlord pays their own charge for this.”

That’s not exactly a break down is it.

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Louisa

Helen, apologies that you are having such a difficult experience. I know how frustrating this must be for you. Standardised fees are not something that the Government has been favorable of in England. But we are still pushing for greater transparency of fees so that tenants can see upfront in adverts what fees are being charged and then use this to inform their choice of property. We hope that this will help create greater price competition in the market. There is still some way to go but the Advertising Standards Authority also took this view. We will continue to push for this.

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Helen

Well here’s one for the records – I sent an email and gave examples of other agents who charged far less and they knocked £60 off each which is better than nothing.

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peter ignjatovic

hi speaking as an agent that lets out property as I have nothing to hide then what ever rules you wish to bring in then please do. but being an honest man I can not see why things should be hidden under the table. being up front with tenants and landlords is some thing I have always dun.
only those agents that have some think to hide are the ones that will have the biggest problems and so there fore will be the ones that will be forced out or will have to change there ways.
So bring on the new rules enforce the new Regulations it`s some think I will well come.
As for contractors that do any work when I can get them to turn up I don`t charge for giving them the work. I always inform landlords up front how much the job will cost and no work is undertaken until they have given full permission to do so. They have the chance of getting some one else into do the work for them but if they ask me to sort things for them then i charge a fee of 25% on top.
my defence is that no one, landlords or tenants are forced into coming into my office and no one pays any money until all parties have agreed that they wish to sign up for a property. over time I have found that being strait honest up front is the way to be gaining respect from all parties and getting on with the job of being an lettings agent.( besides I like my windows to have glass in them not ion bars )

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Claire

Hi I am in the process of finalising my deposit returned from renting a flat out for three years. It is of course first subject to myself and the landlord being in agreement on what to deduct.

The Letting agent has sent me the Check Out Report in a letter which states ” As agreed with you previously at the commencement of your tenancy the cost of this report has been deducted from your deposit accordingly”……

I have subsequently written back and asked them for confirmation of “details and reference of the agreement made at the start of the tenancy regarding the cost of the check out report to be deducted from my deposit including full details of the cost”..

This is because I dont recall seeing these or making such an agreement, ,.,it is probably hidden somewhere in the contract but with no fees given and I certainly wasnt given any list of fees at the start of the tenancy. There are also no list of fees on their website! I will see what comes back, but until I have full evidence in writing Ill be sticking to my guns. I will challenge them when they come back if the evidence is flimsy and not upfront ion the basis that they are unfair and unreasonable as knowing them these are likely to be in the order of £70 and they are likely to try and give some reason that I must pay them or I should have known and there is nothing they can do. I wont be ripped off.

Has Which any other advise it can give me, strengthen my case?

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Louisa

Hi Claire

This is a common grievance! It sounds like you are doing all the right things – if you had to pay fees they should have been in the contract. Wait and see what they say, if they cannot provide evidence they may back down. It may also be worth checking to see if they are a member of an ombudsman scheme or professional bod, which require agents to be transparent on such costs.

Good luck!

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Claire

Thanks Loiusa

I have read about the recent ruling by the Advertising Standards Authority which will be good news for all…

http://www.moneysavingexpert.com/news/mortgages/2013/09/letting-agents-must-be-upfront-about-fees-ad-watchdog-says

BUT also because they havent been upfront on these fees (and I await to have a response back from them yet……) I found this case as provided through the TDS Arbitration… useful to a few I think on here? ….

It is the May 2013 report…..https://www.tds.gb.com/case-studies.html

My letting agency has never provided this information upfront and I dont think the amounts are referenced in the contract so well I will be suggesting that they look at this case – I ll see what they say first though.

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Adam

Hello There,

We have been in a property for 12 months. We just got a letter from our estate agent asking for a rent increase. This is all good and well, but for this ‘new’ contract they are asking for £210 PER tenant (in this case a total of £630) just to process this. I mean, essentially, it’s the same contract isn’t it? And this ISN’T a new tenancy.

How on earth can they get away with this? And suggestions on the best way to handle would be appreciated.

THanks

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peter ignjatovic

hi can you give more information on the back ground and make it more clear as to what you are being asked to pay. what it your rent now, and what you are being asked to pay as the increase per person
is the £210.00 for the new contracts per person or just fees or the new rent you are being asked to pay.???

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Adam

Thanks for your response, Peter.

We have lived in the property for a year. Our rent is currently £1350, the agency has asked to increase to £1400. The problem, from our perspective is the next paragraph, which states, verbatim ‘COSTS- the charge to draw up a further tenancy agreement is £210 inc. VAT per party. This will need to be paid prior to raising any paperwork.’.

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James

The tenants are one party the Landlord is the other. It’s not per tenant I assume.

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Adam

Aaah, this would clarfiy matters. I still thinks it’s exorbitant given we are not moving, but it’s less shocking

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James

It is high. Renewals can be a lot of work but we only charge £70+Vat each side.

Good news on letting agents – new rules should protect millions of tenants and landlords: http://conversation.which.co.uk/money/letting-agent-fees-renting-house-flat-law-complain/

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