letting agent compliance fee?

HOPE30

Hi, I am trying to decide which letting agent to let my flat with.
One is a cheaper one off payment and is hoping to let my flat at a better price than the other.
However as well as 10% monthy (full management)fee they state there is now a compliance fee of £8 a month which they say is due to new legislation they need to register deposits and provide let packs.

Does anyone know if this is the norm??

sandsni

Never heard of it before, but it doesn't surprise me that a LA is using any excuse to charge another fee. I'm pretty sure our LA contract says that part of the service is to ensure compliance with current and future legislation (included in the current fee, not charged separately). £8 per month (£96 per year) is a considerable addition to your fee, especially since each T's deposit will only have to be protected once and each let pack will only have to be printed once (I'm guessing there will be a standard let pack for all Ts). I think the agent is chancing their arm a bit tbh.

Get each LA to give you a FULL breakdown of what services they will offer for their management fee so you know exactly what you can expect for your money. Do you know anyone who has dealt with either of these companies before (either as an LL or T)? Do they have a good reputation for thoroughness in their referencing/vetting process, or will they just dump whoever they can get on your lap and leave you to pick up the pieces? Also, unless you know and trust the company completely, don't sign anything that gives them the right to authorise work "up to £x" or you could end up with an endless drain on your rent while they pass on a lot of minor jobs to their favourite contractor.
If you're a new LL, I would recommend joining a local LL's association as they can provide a lot of information and support. Don't assume you can trust your LA to either know or care about LL's and T's rights and responsibilities. Ultimately it is your responsibility.

princeofpounds

It's essentially a made-up fee. Like a lot of the fees that letting agents charge.

A bit like a fuel surcharge on a plane ticket, the things they are charging should be a normal cost of doing business and the charge bears little relation to the economic cost.

Yes there has been a minor increase in red tape for lettings such has deposit protection, but it's about ten minutes work on the computer and a letter to be sent to the tenant. Maybe less than once a year if the tenants stick around.

Better to view the total cost for the whole service as these things are not dispensible.

As for 'lettings packs'... depends on what they are actually doing. Sounds like normal administration to me.

Also, don't put too much weight on what an agent 'hopes' to let a property for. Most tenants will speak to most visible agents in the area and so unless there is some genuinely special case you aren't likely to achieve higher prices from one than another. Service quality and cost is always more important when choosing between high street agents. But most landlords and property vendors are greedy so promising more is a good way to get houses on your books.

I would also encourage you to find out what they charge tenants. Many (most?) landlords forget to do this but every £ taken from the tenant's accommodation budget for spurious tenancy renewals, overpriced referencing and 'administration' is a £ that doesn't go to the landlord.

Many agents who offer an optically good deal to landlords to get houses on the books then try to gain money by screwing the tenant for all they can. This can deter viewers and make renewals harder, without you ever really noticing.

HOPE30

Thanks for your advice. There is def a lot to think about when letting.
I had emailed LA again questioning the comp fee and said if they had any paperwork as not mentioned in my letting pack and would put my monthly payments up.
they have since replied that they have discussed it with their manager and they are going to take off the comp fee if I am happy to go with them.
So really was just a way to make more money.
The same with my mortgage comp , if I seek their consent to let they add 1.5 % interest to my payments. I can see that this is prob to cover the risk of letting but also a way for them to cash in. Some people have advised I don't need to tell them but I would be too worried about the outcome if they found out.
I am not really letting to make a profit more to cover mortgage to allow me to buy a second property, as currently in one bedroom flat and would make a loss if I sell. But I also don't want to be out of money so trying to minimize costs as much as poss.