When Will Estate Agents Fees be Legislated?

[John145]

So, I’ve owned my own home for a number of years now and back when I was at Uni I worked part time at an estate agents (10-12 years ago).

Now we are moving back to the UK after being in Germany for 18 months (no fees for renters) we have decided to rent in the new area for a couple of years to see how everything settles.

With that bit of backstory hopefully there’s a bit more weight to my opinion that Estate Agents fees for renters are completely ludicrous!

We have found several properties we like (East Anglia) and all estate agents are quoting similar levels:

Admin - £210
References - £96 per person over 18
Inventory - £120

And... something completely bizarre, a deposit waiver fee! This is about £200 and is a none refundable fee so you don't need to pay a deposit but the LL could still charge you money for any damages?! This is optional as you can pay a deposit instead.

Minimum fees payable for the EA is £522.

What the absolute fk? When I was an EA we were charging £20 per person who was paying the rent.

Passport copy? Done
Credit check? Done
Reference check? Done
Contract? Done

How can this work which takes about 1 working hour cost £500+?

It’s a complete con and it’s clear this industry is totally unfit for self regulation.

[C.A.R.]

I believe in Scotland the background (credit) checks cannot be overcharged for, since these cost only 15-20 quid, charging 100+ is strangely commonplace.

I've been renting for about 9 years and even on our first property the fees were eye-watering. It's nothing new unfortunately.

[ClaphamGT3]

Sadly, successive governments have introduced well-intentioned but stupid legislation to transfer the bulk of risk in the rental sector to the landlord. This has been exacerbated by equally well intentioned but stupid legislation to reduce profit levels for private sector landlords.

Surprise, surprise, landlords are now more selective in the tenants they will accept and are employing agents to undertake more searching due diligence than previously.

The unintended consequences of Govt meddling in a free market I’m afraid and the answer isn’t more regulation. As you say in your own post, you are only renting to manage the risk of market uncertainty. Why should that risk management be free or paid for by someone else?

[Slagathore]

Fees have already been banned?

Comes in to effect in June.

[John145]

Slagathore said:

Fees have already been banned?

Comes in to effect in June.

Has this law fully passed now? All I can see online is that it is on it’s 3rd reading?

Useful Sunday morning NP&E rant! Thanks

[Slagathore]

John145 said:

Has this law fully passed now? All I can see online is that it is on it’s 3rd reading?

Useful Sunday morning NP&E rant! Thanks

I think it will be from June 1st:

https://www.gov.uk/government/collections/tenant-f...

[John145]

Slagathore said:

John145 said:

Has this law fully passed now? All I can see online is that it is on it’s 3rd reading?

Useful Sunday morning NP&E rant! Thanks

I think it will be from June 1st:

https://www.gov.uk/government/collections/tenant-f...

Great news. End of thread!

[anonymous-user]

Another ill conceived piece of legislation.

I own a letting agents, our fees have always been very reasonable.

£50 referencing fee per tenant
£195 Admin fee
£60 Inventory

I fully understand that something had to be done as some agents have been royally taking the piss with their fees.

However there is a material cost for finding, referencing and checking in good quality tenants.

So guess what? The landlord will be charged and that cost will be passed on to the tenants by way of rent increase, all our properties will be subject to a £50pcm rent increase upon renewal after 1st June and all the other agents I have talked to will be doing similar.

What they should have done was cap tenant fees at £250-£300 index linked.

[Squiddly Diddly]

digimeistter said:

Another ill conceived piece of legislation.

I own a letting agents, our fees have always been very reasonable.

£50 referencing fee per tenant
£195 Admin fee
£60 Inventory

I fully understand that something had to be done as some agents have been royally taking the piss with their fees.

However there is a material cost for finding, referencing and checking in good quality tenants.

So guess what? The landlord will be charged and that cost will be passed on to the tenants by way of rent increase, all our properties will be subject to a £50pcm rent increase upon renewal after 1st June and all the other agents I have talked to will be doing similar.

What they should have done was cap tenant fees at £250-£300 index linked.

You are providing a service to the landlord, it is therefore the landlord that should pay your fees.

[John145]

Squiddly Diddly said:

You are providing a service to the landlord, it is therefore the landlord that should pay your fees.

Exactly. The one thing that makes capitalism work is competition. The link is broken for this mechanism though with the current setup.

Now the link will be clear: this EA charges more to offer a guarantee of better tenants, this EA charges less for less guarantees.

TBH I’m guinely surprised fees of 300-400 are though to be acceptable! It’s not a difficult job and does not take more than 2 hours working time to get a very thorough reference done. If you think it takes longer it’s because the methods are inefficient and now capitalism will deal with these inefficiencies the good old capitalism way. Change or go bust.

[Baby Shark doo doo doo doo]

Seems more reasonable than 7 years ago. Estate agent fees came to about £1 500 when we were looking to rent a house in Andover. I vividly remember thinking “fk off” as admin, reference, deposit etc charges were continuously added to. The cheeky git then gave us a link to print off the 30 page forms we needed to sign In total we’d have had to pay £3 000 in advance before the monthly charges were added.

Ended up a good thing as we bought a house instead and made £75k in two years

[anonymous-user]

Squiddly Diddly said:

You are providing a service to the landlord, it is therefore the landlord that should pay your fees.

We are also providing a service to the tenant, the job doesn't stop when the tenant moves in you know.

[craigjm]

Squiddly Diddly said:

digimeistter said:

Another ill conceived piece of legislation.

I own a letting agents, our fees have always been very reasonable.

£50 referencing fee per tenant
£195 Admin fee
£60 Inventory

I fully understand that something had to be done as some agents have been royally taking the piss with their fees.

However there is a material cost for finding, referencing and checking in good quality tenants.

So guess what? The landlord will be charged and that cost will be passed on to the tenants by way of rent increase, all our properties will be subject to a £50pcm rent increase upon renewal after 1st June and all the other agents I have talked to will be doing similar.

What they should have done was cap tenant fees at £250-£300 index linked.

You are providing a service to the landlord, it is therefore the landlord that should pay your fees.

How wonderfully naive.... whatever costs the landlord incurs will always be passed on to the tennant in increased rent charges. Being a landlord is not about charity.

Anyone moaning about all of this should go and buy a place then.... oh I forgot.... estate agent fees and stamp duty paid every time you move make rental costs look like peanuts in monkey poo.

Edited by craigjm on Sunday 21st April 11:53

[Squiddly Diddly]

digimeistter said:

We are also providing a service to the tenant, the job doesn't stop when the tenant moves in you know.

I would say that you are still representing the landlord.

[Squiddly Diddly]

craigjm said:

How wonderfully naive.... whatever costs the landlord incurs will always be passed on to the tennant in increased rent charges. Being a landlord is not about charity.

Anyone moaning about all of this should go and buy a place then.... oh I forgot.... estate agent fees and stamp duty paid every time you move make rental costs look like peanuts in monkey poo.

Not necessarily. Rent is far more market driven. Different letting agents charge different rates and some landlords don't use agents at all.

Do property buyers now pay the sellers estate agent fees?

[craigjm]

Squiddly Diddly said:

craigjm said:

How wonderfully naive.... whatever costs the landlord incurs will always be passed on to the tennant in increased rent charges. Being a landlord is not about charity.

Anyone moaning about all of this should go and buy a place then.... oh I forgot.... estate agent fees and stamp duty paid every time you move make rental costs look like peanuts in monkey poo.

Not necessarily. Rent is far more market driven. Different letting agents charge different rates and some landlords don't use agents at all.

Do property buyers now pay the sellers estate agent fees?

Of course they do in a strange way. When you price things for sale you price it based on any costs you are going to incur as best as you can. As long as that doesn’t price you out of the market why would you not?

[Squiddly Diddly]

craigjm said:

Of course they do in a strange way. When you price things for sale you price it based on any costs you are going to incur as best as you can. As long as that doesn’t price you out of the market why would you not?

So market driven then.

[craigjm]

Squiddly Diddly said:

craigjm said:

Of course they do in a strange way. When you price things for sale you price it based on any costs you are going to incur as best as you can. As long as that doesn’t price you out of the market why would you not?

So market driven then.

Why are you arguing with me? I agree with you it was digimeieseter that the comment was aimed at. Nothing is free in this life and if there are costs involved to a transaction then the end user ultimately pays period regardless of what we are talking about

[croyde]

I understand some cost re references, ability to pay etc but a lot of London EAs are taking the Urine. Some as much as £500 before all the other costs.

When the agent contacted me after one year to say that I had to sign a new agreement for £250 if I wanted to stay on, I did a little research, some via here.

Turned out I did not have to do anything and told them so. They then said £50 and I still refused. It was dropped to nothing.

I bet many people, frightened of losing the roof over their heads, pay up.

[craigjm]

croyde said:

I understand some cost re references, ability to pay etc but a lot of London EAs are taking the Urine. Some as much as £500 before all the other costs.

When the agent contacted me after one year to say that I had to sign a new agreement for £250 if I wanted to stay on, I did a little research, some via here.

Turned out I did not have to do anything and told them so. They then said £50 and I still refused. It was dropped to nothing.

I bet many people, frightened of losing the roof over their heads, pay up.

Indeed. There are lots of unscrupulous people out there. Thankfully in this day and age it’s easier to do your research and fight back as you demonstrate.