Agents and Tenants Discuss Lettings Fees
On Friday, tenants and letting agents met in London to debate the issue of fees in the private rental sector.
With a harsh start, agents told tenant representatives: “If they don’t like our fees, they can go elsewhere.”1
Letting agents, Ombudsman representatives and tenant groups, Generation Rent and Renters Rights, joined up at L’Escargot on Greek Street in central London.
Generation Rent and Renters Rights called for tenant fees to be abolished completely, but agents argued that they are businesses that need to make money and that scrapping fees would cause landlords to increase rents in order to recover the money.
Rosie Walker, of Renters Rights (London), stated: “Now more tenants are aware that they need to be told what the fees are upfront. But we say tenants should not be paying any fees at all.”1
The Managing Director of property software firm VTUK – which hosted the lunch – Peter Grant reported that recent research by his company reveals that based on a letting agency branch with 50 landlords and 75 managed properties, the average fee profit margin is just £159 per tenancy.
The Managing Director of Rowe Property Services, an independent agency in Hampshire, Mark Rowe, argues that a free market allows tenants a choice.
He said: “We are a business; you have an option but we have to make money. I am not forcing the money out of you. If you want to go for one of my properties, that is what I charge.
“If you want something from someone, you pay for it; surely we are not in a generation now where things are free of charge. I know [campaign groups] say tenants shouldn’t be charged at all, but if we are doing the work, then we should be paid.”1
The discussion focused on a number of issues, including how agents justify charging fees to tenants and landlords, what would happen to rent prices if agents could not charge fees to tenants and if there is enough transparency over the fees that agents charge.