Disparities in Fees

As a tenant living in the private sector, I have mixed experiences of letting agency fees. I appreciate that setting up tenancies requires a certain degree of work and as with any other service in the private sector, it is not unreasonable to expect a fee in return for this service. Despite that, there are glaring disparities between fee amounts across different agents which do not seem to be justified. Especially when they are supposed to be offering the same service. 

I once viewed a property (rent p/m £650) and was advised by a Cardiff based letting agency, that the initial letting agency fees to start the application would cost over £600. When questioned as to why the figure was set at that, I was advised that it was due to the agency producing a tenancy agreement, 'which was an actual legal document'. This particular fee was completely unaffordable when considering a security deposit and a month's rent in advance and as such, I was not able to apply for the property. During this period, I viewed a different property marketed at the same rent level (within the same area) however the letting agency fees were remarkably lower (£150) and as such, I was able to apply for the tenancy and was successful.  

 

Why the contribution is important

The private rented sector is increasingly becoming the only viable option for a diverse range of people who cannot afford their own home or do not meet the criteria for social housing. I feel that some letting agents have heavily exploited this by charging excessive fees in order to maximise their own income. By doing so, they have contributed to making the sector inaccessible, unaffordable and difficult for people who are reliant on it.

by NTAzadWarren on August 16, 2018 at 03:32PM

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Based on : 2 votes

Comments

  • Posted by Carad August 16, 2018 at 18:37

    £600 is a ridiculous amount to request, even considering referencing etc. is probably included.

    The tenancy agreements are almost always 'boilerplate', even more so with more terms prescribed by law. While the agent may have paid a lawyer to prepare the precedent for their firm - and good agents usually pay very good and often the more expensive lawyers to do this given their importance - each agreement they produce thereafter takes minutes, usually by an administrator.

    Other agents may use precedents prepared by a professional body (if they're a regulated firm - ARLA, RICS etc.), which is similarly simple to complete for each letting.
  • Posted by Dyfnwal August 17, 2018 at 00:21

    1. Abolish initial letting agency fees.
    2. Limit security deposits to 3 weeks or 1 months rent at most.
    3. Holding deposits if used should NOT be set in addition to security deposits and the initial advance months rent. If taken up, the holding deposit should be used for the security deposit and the advance months rent.
    4. Abolish Section 21 (eviction without explanation) as in Scotland.
    5. If point 4 is not taken up, then return the security deposit within 24 hours of termination of contract by a section 21 eviction.
  • Posted by Beth August 20, 2018 at 15:31

    If there are fees, then I think they should be capped or set for different services (this is how much you can charge for references).
  • Posted by Chloe_Cardiff August 29, 2018 at 09:54

    Not only are there excessive fees, estate agents charge unnecessarily for guarantors. Partner had a good job (junior doctor) but had to get a guarantor as the job wasn't technically permanent. It was subject to passing hospital standards like all other junior doctors but 99% pass this without problems. We had to get my mother to be guarantor even though she earns less than partner. This was at a cost of £120 and quite unnecessary. It is just a matter of greed as we are not high risk tenants.
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