Are letting agents playing fair with their fees?

Hi Dennis … I thought that if you allowed the tenants to carry on with the periodic tenancy, then the rent would remain exactly the same as the original £1375 per calendar month … unless of course you’ve got a built-in increase to say that the rent will be going up to a particular predetermined level.

Reply to the comment left by Jay Patel at 27/10/2022 – 16:54
You can increase the rent on a Periodic tenancy as long as it’s agreed in writing by both parties.

Reply to the comment left by Dennis Forrest at 27/10/2022 – 16:39
The letting agent wanted be to sign a new 12 month contract with a 5% rent increase and charge me 8% for the privilege.

You couldn’t make it up!!!

And landlords fall for this rubbish.

Reply to the comment left by Jay Patel at 27/10/2022 – 16:54
Hi Jay – the tenants have agreed to the small increase even though it has now switched to a periodic tenancy,
I have agreed with the tenants, (assuming they are still in occupation), that the rent will be reviewed but not necessarily increased every 12 months. This arrangement will run from the 15th December each year, the expiration of the the initial 12 month fixed tenancy agreement.

Hi Dennis … that’s good to know, but I would check the legality of that. The law is very specific about changes in the rental value and if it goes up without a precondition, and that could be deemed as a prohibited payment. This wouldn’t fall under the tenant fee act and may be seen as a breech.

By the way, I’m not an expert, but something doesn’t feel right about it. Best of luck.

Reply to the comment left by Jay Patel at 27/10/2022 – 20:36
Hi again – I have been renting property since 1995 and never had a problem agreeing rental figures with any tenant. I always try and put myself in the tenants position and think if I was the tenant ‘ Does this seem like a fair deal?’
I never let the rent reviews go longer than 2 years otherwise you may get in to the position after say 5 years and you are then asking for at least a 10% increase which would come as a shock to most tenants.

That’s a very fair and reasonable attitude, Dennis … my only real concern for you is whether you are allowed to increase the rent whilst it’s turned into a periodic tenancy. Under normal circumstances you cannot alter the rental amount unless it’s a rent review at the end of the contract. At least that’s how I’ve always understood it to be.

I would get a second opinion.

Reply to the comment left by Jay Patel at 27/10/2022 – 22:26
Hi Jay. My opinion is that a Periodic Tenancy can be terminated with 2 months notice from the landlord (and 1 month fron the tenant) and so an increase will be allowable with 2 months notice.

As others have said, you should check your signed T&C’s of the agent in detail.

Without question the 1% should be refunded. Agents doing rent collection often make this mistake when the renewal commission reduces.

As for charging for the months where no rent was received, again it’s down to the T&C’s. Did you allow the tenants to break their contract early? In those scenarios, I always explain to the tenants that I will do everything I can to allow them to break the agreement as long as I’m not out of pocket.

First I speak to the agent and discuss the commission with them. Some agree to refund pro rata to get the future business of finding a new tenant (even if their T&C’s state they don’t have to) but many will not.

In that case, the existing tenant should be paying rent & bills up to the date a new tenant moves in, plus paying the pro rated agent commission for the time they are leaving early (and that I will have to pay again for with the new tenants).

One of the agents (a large chain) actually has this in their AST – although thinking about it now I wonder if that breaches the tenant fees act? Although it’s still technically less than the total rent owed for the period contractually. I will check this.

Agents renewal commission comes up on here all the time. It’s really down to who you want to work with and it varies massively from area to area. Some agents will negotiate their fees, some will not.

I have had several 1 year contracts with tennants. The estate agent is only involved for the initial contract and then its a rolling contract for any further tennancy with an agreement that 2 months notice will be given if tenant leaving and 3 month if you want the property back.
If a tennant leaves a contract early IE before the 12 month term is finished then they pay any further agent fees. Not you as they broke the contract.
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