Renting, high estate agent admin fee

talksr

Hi, I am looking to rent a small studio flat. I have found one for £500 per month. It is extremely small, but it is the cheapest I can find.

The estate agent said, I would need to pay 1 and a half times rent up front for damages, a months rent up front, and a £300 admin charge.

I asked about the admin charge being refused but he said due to the shortage of rental places in my area, it was compulsory. I just find it is very high, and the amounts I need to stump up inititally will mean I will need to take out a loan just to be able to rent a place let alone pay the monthly rent and bills.

I am waiting for him to call back to clarify: "I would need to pay 1 and a half times rent up front for damages, a months rent up front..." I am hoping he made a mistake and meant one of the other, not a month and a half plus a month.

Does any one have experience of these admin charges. I know they do charge them, but £300 seems steep.
Thanks :j

Gromitt

I know someone who recently rented a place in Birmingham and they were charged £200 admin fee + 6 weeks rent up front.

2.5 times rent seems a bit much though.

Grimbal

talksr wrote: »

I am waiting for him to call back to clarify: "I would need to pay 1 and a half times rent up front for damages, a months rent up front..." I am hoping he made a mistake and meant one of the other, not a month and a half plus a month.

Does any one have experience of these admin charges. I know they do charge them, but £300 seems steep.
Thanks :j

£300 does seem steep on a rental of £500pcm. However, the 1 1/2 months as deposit & 1 months rent paid in advance is fairly standard

moromir

1.5 months rent is relatively standard for a damage deposit although perhaps a touch on the high side for a studio flat.

Rent is paid in advance so yes you will need to pay the first month's rent on the day you move in.

What does the £300.00 include? Tenancy agreement? Drawing up the inventory/check in procedure, notifiying utilities? Check out? Find out, and then find out if there are any other charges.

ETA: Are you sure you have sufficient income to rent a property? What happens if you lose your job? Presumably you have no savings if you're having to take out a loan just to move in, you will be liable for the rent for the whole term unless the landlord agreed to an early release.

If you are being referenced a referencing agency will look at approximately 40% of your gross income as being the maximum affordability which on a 500pcm property would equate to an income of roughly £15,000 per annum.

talksr

Hi, and thanks for all of your posts, they are all very useful.

I have sent the estate agent an email asking exactly what is included in the £300 admin charge. And in the mean time, I am going to ring some alternative local estate agents and see if they can tell me what their admin fee is, so I can get a feel for the average charge in my area.

With regards for the rent, I do have quite a bit saved up (for buying a home in a while), but I would not touch the money unless things were really bad. I would rather just use my overdraft than have to take money out of savings accounts.
I have calculated the amount I would owe for the term (6/12mth) and will have that available in savings, should I really need to.
I would also have enough to cover the bills too.

moromir wrote: »

1.5 months rent is relatively standard for a damage deposit although perhaps a touch on the high side for a studio flat.

Rent is paid in advance so yes you will need to pay the first month's rent on the day you move in.

What does the £300.00 include? Tenancy agreement? Drawing up the inventory/check in procedure, notifiying utilities? Check out? Find out, and then find out if there are any other charges.

ETA: Are you sure you have sufficient income to rent a property? What happens if you lose your job? Presumably you have no savings if you're having to take out a loan just to move in, you will be liable for the rent for the whole term unless the landlord agreed to an early release.

If you are being referenced a referencing agency will look at approximately 40% of your gross income as being the maximum affordability which on a 500pcm property would equate to an income of roughly £15,000 per annum.

moromir

What I'm getting at OP is that a letting agent probably isn't going to just accept you have money available in savings if you don't pass their affordability checks... cos you could just spend it on something else! They're probably going to want either rent in advance or a guarantor - so you need to suss that out for definite and check there arn't further fees for guarantor referencing/paperwork etc.