/ Home & Energy, Money

Are letting agents breaking the law on fees?

A picture of a house on a chalkboard

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?

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?


I’ve just decided to move to another property for health reasons so won’t be renewing the lease on this one.my previous agents have just advised they will not provide referencing to new landlords unless I pay a fee.im shocked at this having just paid hundreds in fees for referencing to the new property agents.any advice please?

According to the law, for how long does a landlord have to pay the standard letting fee (not management fee) to an agent if the tenancy agreement lasts 3 year or more , with the same tenant living in the property ?
– I understand that for year 1, landlord pays agent full letting fee.
But then what happens :
-Year 2 : is it against the law for agent to not reduce the letting fee charged to landlord ?
– Year 3 and onwards : is it against the law for agent to charge any letting fee to the landlord ? Should landlord still be paying anything ?

Thanks !

R.Cobb says:
12 February 2016

High way robbery,is how I describe it! We are being robbed,left,right,and center! We get charged for nearly,if not all,everything.
People should all get together,enough is enough!
These are the people,who we put in power,to look after the citizenry,esp.the masses. And not to “boss”us around.
We’ve been in many countries,and we can safely say,this is the only country,where we have to face too many complications,just to rent a flat.

can annyone help me i have giving my months notice but landlord is still expecting me to pay all my rent up til the end of the contract which ends 1st of june can he do this?

Here is a list of the fees we have just been told we need to pay for me and my bf to move in together. I personally think they are excessively high. what does everyone else think?
Its an unfurnished property:

Admin fee £197 Per Person £394
Current Tenant Reference Fee (per tenant) – £35 £70
Immigration Visa Check (non EU citizens only) – £24 N/A
Deposit Registration Fee – £30 £30
Property Check in – £36 £36
Property Checkout – £36 £36
Guarantor Fee (per tenant) – £69 £0
Inventory -£-Subject to Property £180
Total Fees Inc. Vat @20 % £746

I have rented for alot of years and have always gone through a private landlord so have never incurred the above cost. Can any one help if these are fair?

Crystal – I think some of those fees are daylight robbery and the rest are to varying degrees extortionate.

These are presumably imposed by the landlord’s choice of letting agent who will profit from any that exceed the actual cost of carrying out the requisite check or function. Am I correct in assuming that you are in a London or big city property? That will make a difference to some of the fees where there is a significant labour and/or travel element [like property check-in as one example] but others relate to standard checks for which there is a standard pro forma, a universal fee, and a universal postal cost. Unfortunately, once you have entered the tenancy there is hardly anything you can do to get the fees reduced.

I am not sure why you have to pay a check-out fee when moving in.

The killer fee is Admin at £394 for the two of you. What has been done for that that is not already covered by the other specific fees [like deposit registration]? Also I should have thought some of these costs should be included in the 10-15% that the landlord is being charged for general management and which is passed through to you in the rent – that would reduce the upfront burden.

It was announced yesterday in the Autumn Statement that from April 2017 landlords will have to meet letting agents’ fees themselves in the first instance. That will put them under an incentive to choose more competitive letting agents. They will recover their outlay through the rents of course, but rents have to be competitive against other similar properties in the area, so tenants should get some relief in due course.

The fees would be held to be unfair [and therefore unenforceable] if they were exceptionally unreasonable and I am afraid in today’s private lettings market it would be difficult to argue that point, in my opinion. The cost of proving the point even if were true would probably be prohibitive [although you would get your costs back and a refund if you won] and it could have other unforeseen consequences.

As far as I know these fees will become illegal. However for a letting agent to act properly on behalf of the landlord they will have costs on some or all of the above items, in both fees and in time. Prospective tenants need vetting for the suitability, inventories need to be checked at the start and finish, references need to be taken up, and if these charges are not made directly they will be passed on to the landlord and reappear in the form of an addition to the rent. However the question also asked is the scale of the charges. If these are passed onto the landlord rather than the tenant then they may be subject to more scrutiny.

I think outright banning of all fees has gone too far; some fees should directly fall on the tenant, others such as “admin” should not.

Having always bought property (7 house moves to date), decided to have a look at renting in UK. `WOW´ what a mine field! the rental market appears to be. Might seek a `private buy to let´ person who will gladly let their property to a full rent paying person, meaning the Landord would receive a better financial return on their property investment i.e. the full return without any costs to the landlord. Obviously there are the proper checks to be made so, why would the prospective renter not use a qualified financial adviser to provide those background checks of the renter for the renter to provided to the prospective landlord. There have been too many rip offs in the recent past with PPI, Endowment Mortgages and Bad banks all fleecing the general public. It`s time the Polititions, representing every UK English constituancy took up this alleged `theft by another name´ perpetrated upon the English again. (Perhaps we should all move to rent in Scotland!.)