"Rip-off" tenancy fees - Fight back!

JencParker

Notoconsumerapathy wrote: »

Hi all

I am new to this forum but recently experienced for the first time myself the "rip-off" tenancy fees some estate agents charge and felt that the Consumer Rights Act's transparency clause did nothing to assist me all because the estate agent told be about the fee upfront. Total fees for me, not including tenancy renewal fees are circa £900 – the cost of a mortgage product.

It's not exactly as if you can shop around and use another estate agent for the same property. If you like the property then you are stuck with the estate agent. Crucially, I have privately investigated and discovered that the difference between the true cost of the service being purchased / offered and the actual fee charged to the consumer by the estate agent is considerable and in my opinion completely unethical and unjustified. Surely estate agents earn their profit from the Landlord?

Not all estate agents are like this but certainly all the major players seem to be. There is virtually no competition and the tenant is treated as a cash cow.

I would certainly urge anyone interested to sign SHELTER's campaign to end letting fees (broken the link below as a new user I cannot include links)
http:// england.shelter.org.uk/campaigns/fixing_private_renting/letting_agencies/sign_our_petition


Does anyone have any thoughts or experience they would like to share?

Cheers

I have already. The problem is that too many think it is perfectly acceptable to do anything in order to make a profit - the bigger the profit the better

Annabee

Gonzo1987 wrote: »

If tenant fee's are banned then rents will increase because the agent's will have to charge the landlord more, who will in turn, pass this onto the tenant.

I agree certain agents seem to charge a lot, but some, (like us) don't charge extortionate fees, but, fee's aren't at the forefront of a tenant's mind when looking for somewhere to live. We're not a charity, we have to do a lot of work on the tenant's behalf, not just the landlord to create a tenancy, so why shouldn't we charge for that service?

Fee's should be regulated, not banned.

But you are the landlord's agents, aren't you? And acting on their behalf in everything you do. If there was to be a dispute between landlord and tenant you would be on the landlord's side automatically, because they are your client. The tenants aren't. Have you considered that? After all, when it comes to buying and selling, you're not charging the buyers as well as the sellers. Although some agents would probably like to!

Sorry but in my opinion it's not right that letting agents should charge tenants (especially high fees) when they are not acting for them, but sometimes directly against their interests. There doesn't seem to have been a problem in Scotland, when banning fees to tenants there.

His_Dudeness

This debate about what agents can charge tenants is a red herring.

Everything an agent charges a (prospective) tenant is deemed charged by the landlord. In fact, the agent cannot keep any of the money unless it was agreed with the landlord.

Thus, e.g. if an agent charges a landlord £200 for referencing and setting up a tenancy agreement the landlord can decide to pass on that fee onto the tenant and instruct the agent to collect from the tenant.

PasturesNew

I'd ban them. All of them. Agents used to make their money by getting 10% of the collected rent from the LL and their business was to ensure they had [a] enough properties on their books to make that a viable income to minimise voids by keeping tenants.

Now there's a lot to be gained (by agents) to continually encourage the LL to increase the rent, trousering a fat fee with every tenant that leaves because they can't afford to keep paying increased rents.

Not to mention the booking in fee, booking out fee. The fee for printing out a new AST each 6 months. And loads more they invent every time they spot an opportunity for some cash trousering.

Notoconsumerapathy

Not to mention the booking in fee, booking out fee. The fee for printing out a new AST each 6 months. And loads more they invent every time they spot an opportunity for some cash trousering.[/QUOTE]

The booking out fee or inventory check out fee is an interesting one. I was sold this on the basis that the inventory clerk is independent and the LL pays the check in fee. I was told an independent is used to avoid disputes and arguments that the inventory clerks are agents of the LL/MA. If they are independent, on what basis does the MA charge a 320% mark-up? This is not advertised of course and I only know this through my own investigations.

In fact, one could easily argue that by virtue of the mark-up and the fact that the MA chooses the inventory clerk, that the clerk is far from independent.

I have been criticised by some in this forum for failing to understand how business works. A ridiculous notion in my opinion. To those people I would say do your research on this and what else is being challenged at the moment i.e “rip-off charges on insurance products. If we all lived in your world nothing would ever be challenged. The Government has stepped in already to assist LL’s with MA issues and has already stepped in to help tenants. My argument is that they haven’t gone far enough.

His_Dudeness

Notoconsumerapathy wrote: »

N I have been criticised by some in this forum for failing to understand how business works. A ridiculous notion in my opinion.

There's none so deaf as those who will not hear.

JencParker

His_Dudeness wrote: »

Do not take that the wrong way, but you seem to indeed lack knowledge on economics, the private rented sector, and politics.

The issue with simplistic and demagogic campaigns like those against letting agency fees is that they are difficult to counter because people do not really want to think issues through but want quick and simple solutions, ideally putting the blame on a group that they already do not like.

Basically, if you ask someone if they want to pay less they are not likely to reply 'no', especially when the people they pay to are seen as fat cats.


By the way, the letting market is absolutely not a monopoly market, and is actually not concentrated at all with many small landlords and small agencies. In fact, it should stay that way for the benefit of tenants.

Lastly, a letting agent is not acting independently of landlords and tenants. They are taking instructions from landlords and acting on their behalf.
It does not mean that tenants cannot be charged but landlords must agree.

What a ridiculous thing to say - however, what the OP may lack is the knowledge that there are plenty of BTL landlords and given that it is a money based forum, plenty who are eager to make as much as they can who will have little sympathy for the OP's concerns.

His_Dudeness

JencParker wrote: »

What a ridiculous thing to say.

It seems that my post #37 applies to more than one.

JencParker wrote: »

what the OP may lack is the knowledge that there are plenty of BTL landlords ... who are eager to make as much as they can.

QED.

daisy333

The thing that annoys me is estate agents deserve to earn something but they are... They earn a monthly fee, I don't mind in some case the sign up fee but the renewal contract fee is way too high... we had to pay £320 to renew a contract when us leaving would have caused them 50 times more work. Why are we being punished for giving them less work to do? They still make a monthly fee with no extra work accept asking us to sign and return a piece of paper?

If we left they would have to readvertise and find new tenants? We are basically being held ransom with the threat of being asked to up-root our family.

Yes estate agents need to make a living but blackmailing families into paying a huge fee or uproot for no more than a 10 minutes renew job is unconscionable and anyone who can screw their estate agent out of this fee I suggest you do all you can...

The best thing to do is contact the landlord and ask for your contract to be turned into a rolling contact with no need to re-do the contact each year.

Gonzo1987

Innys1 wrote: »

I presume you aren't an online agent. If you are, I apologise. If you aren't what do you offer which justifies charging several times what an online agent charges?

High St agents will soon go the way of the dodo and an element of reasonableness will return to fees.

Not an on-line agent, and yes, we do charge more than an on-line agent, but not several times the amount. The charge covers the cost of referencing, which we pay for, the cost of the time it takes to create tenancy and all the other admin that goes along with it. We don't charge a tenant to renew their tenancy, we also don't mind if they want to let it roll into a periodic tenancy.