agency fees £150 fair?

tom9980

I dont think £150 is too bad personally, scotland may no have charges but i would guess that a landlord would have the rent £5 a month more to cover that problem. Back of a fag packet sums suggest it costs about £75-100 for referencing, EPC (once every 10 years), inventory/checkout, admin and printing. If you add in agents then another £50 for wages and overheads.

The main issue for high fees seem to be agents profiteering from ignorant landlords and tenants.

MrUsername

tom9980 wrote: »

I dont think £150 is too bad personally, scotland may no have charges but i would guess that a landlord would have the rent £5 a month more to cover that problem. Back of a fag packet sums suggest it costs about £75-100 for referencing, EPC (once every 10 years), inventory/checkout, admin and printing. If you add in agents then another £50 for wages and overheads.

The main issue for high fees seem to be agents profiteering from ignorant landlords and tenants.

Your answer seems to hold the most weight to me, I will go with your advice, thanks

rtho782

I dont think £150 is too bad personally, scotland may no have charges but i would guess that a landlord would have the rent £5 a month more to cover that problem. Back of a fag packet sums suggest it costs about £75-100 for referencing, EPC (once every 10 years), inventory/checkout, admin and printing. If you add in agents then another £50 for wages and overheads.

The main issue for high fees seem to be agents profiteering from ignorant landlords and tenants.

I disagree.

Referencing costs £8.95 from the National Landord Association, £24.50 if you want them to contact previous landlords and employers for you because you can't be bothered with a phone call. Bear in mind that, while it's best to do as much referencing as you can, it's next to pointless as you can't do actual credit scoring, so someone could be up to their eyeballs in debt, and have 100,000 defaults, but as long as they have no CCJs you will find nothing. And as for previous landlords, as you can only go by the contact details the tenant gives you, you do not know if they are really previous landlords, or the tenants mates.

I've done my own employment reference before which my boss just signed for me to fax back because he couldn't be bothered with it.

http://www.nlatenantcheck.org.uk/services.aspx

EPC is needed regardless of a new tenant moving in, it's a cost of business. That's like saying Tesco should add an admin fee onto every shoppers bill to pay for staff uniforms. If you had one tenant for 20 years, you'd still need EPCs, and wouldn't get to charge admin fees for them. Conversely, in 10 years you could have 20 tenants, you're saying you should charge all 20 of them for the EPC??

Inventory/Checkout is for the LLs benefit not the tenants. I'm quite happy to have no inventory/checkout thanks, that way my deposit is 100% secure. Why should the tenant pay for it?

Letting agents also charge the landlord a "finders fee" for the tenant, and then 10% a month or whatever for "management". They are leeches, scum, and deserve no sympathy ever.

Miss_Samantha

rtho782 wrote: »

That's like saying Tesco should add an admin fee onto every shoppers bill to pay for staff uniforms.

They do, on everything they sell. This is called the markup.

Why should landlords not do the same?

rtho782

They should build these costs into the rental price, not add on admin fees and pretend they have to charge every tenant for an EPC. It is a cost of doing business.

Adding on admin fees in this way would be like a £2 surcharge on every transaction at tesco to pay for uniforms.

As for referencing, my point is that what you pay an agency £250 +£100 per additional tenant for, a) does not cost them that much, NLA will do full referencing for less than £25, and b) is worthless, you'd be better off sitting down for a chat with the prospective tenant, you'd get more of a feel for them.

rtho782

Incidentally you need an EPC to sell a property, so would a LL be pleased if his offer on a new BTL property was accepted at £220,000, then he was told he also needed to pay a £250 "admin fee" for the cost of the EPC?

tom9980

Your preaching to the choir i only charge £50 per tenant, i dont use agents at all due to the fee's. If you want me to bundle it into the rent sure but given i would increase the rent £5-10 a month you would only be making things less fair for my tenants because they will end up paying more in the long term.

If you dont like the fees agents charge then get the law changed and start lobbying your MP.

Miss_Samantha

This is all wishful thinking and value judgements.

Each industry has its norms, either because "that's the way we've always done it" or because they make sense in the context.

Many industries charge upfront fees in addition to recurring payments. Usually it is because specific tasks are required upfront and that it may not be guaranteed that the relationship progresses further. E.g. education, loans, clubs, etc.

Letting is the same.

There is no economic reason to ban upfront fees. Where such fees have been banned they have been for lowly political reasons, and people uses workarounds.

If a landlord thinks it makes sense not to charge upfront fees then that's his choice, but usually it makes sense to charge.

AdrianC

You're asking the wrong question, IMHO.

The question isn't "Is this fee fair?", it's actually "Do I want to pay this fee in order to move into this property?", because that's your choice. You can't find a way to move in to that property without paying that fee. You can only decide whether to pay the fee and move in there, or not pay the fee by not moving in.

Only you know whether it's worth paying that fee to move in there, compared to other places that you could move in to and what they would cost you.