Landlords, particularly those with large portfolios, often rely on letting agents to help manage their properties.
However, the Office of Fair Trading (OFT) has warned landlords that they could be receiving a poor service and being charged extortionate amounts by their agents. Additionally, tenants could be subject to the same practices.
The OFT has received over 4,000 complaints about letting agents from landlords and tenants. It says that agents must change how they operate. One of the most common complaints is that agents often charge hidden fees after the contracts have been signed, or that are implemented gradually.
Furthermore, communication between landlords and tenants with their letting agents has been criticised, as many problems are left for long periods without being resolved. These issues could be fixed through landlord insurance.
Senior Director of Goods and Consumers at the OFT, Cavendish Elithorn, says: “Our findings show that tenants and landlords are often dissatisfied with their agents but we also know that most agents want to do the right thing.
“It’s important that tenants ask for key information, but we also believe the Government, industry and enforcers working together can have a real impact and improve overall standards in the lettings market.”
Ian Potter, the Managing Director of the Association of Residential Letting Agents (ARLA), responds: “The OFT’s report highlights some of the problems with the rental sector.
“Today, the sector is expanding, as homeownership becomes out of reach for many. However, lack of regulations and pressures on housing supply mean some unscrupulous landlords and agents are able to take advantage of consumers, and are driving down the reputation and standards of the sector as a whole.”