Letting fee ban – A better plan?

Letting fee ban – A better plan?

10:29 AM, 1st October 2018, About 6 years ago 12

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I run a small letting agency and am almost certain to exit the market when the fee ban comes in as it is income we cannot in all good conscience replace. I plan to go into commercial property and sales instead, run my own portfolio and get a life!

It occurred to me that since Landlords will take the brunt of the fee ban and in consequence need to charge higher rents to offset this, there may be a better way of dealing with the issue.

We charge inbound tenants for the referencing at cost plus an admin fee per property. This usually equates to around £250 – £300 per letting.

If we let a property at £695 PCM initially with an option to continue at £650 PCM after six months of good behaviour, rent paid on time and a favourable inspection, would this be seen as a ‘fee by the back door’ or simply recognition and reward for good behaviour?

Some of the items where charges are now being outlawed are crazy in my view.

Many thanks

Jon


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Comments

Jon Dahms

12:31 PM, 22nd October 2018, About 5 years ago

Great responses people. The issue of 'Double Charging' i.e. a Tenant Fee and a fee to the Landlord is a vexed one. Landlords are shopping around and some agents have a model which allows them to offer full management at 5% of the passing rent. Our largest single cost was our Rightmove subscription which was more than our office rent and heat/light put together. As I said, we are a small agency and we have conducted a straw poll of our Landlords and they are all unwilling to pay additional fees or put their rents up so that their properties become uncompetitive. Some agents really take the piss with tenant fees but our fees were based on our costs to conduct a letting professionally and conscientiously plus a small overhead and profit allowance. The Landlord fee covers advertising / epc etc....

T G

17:22 PM, 28th November 2018, About 5 years ago

In my view the high street estate agent is dead - the portals will be next.

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