Extortionate Letting Agent Application Fees
Written by The Landlord on 11 Jan 2012A few years ago I wrote a blog post (feels shitting bizarre that I’ve been blogging for so long and I can refer to shit I wrote years ago) about Letting Agents Charging Tenants An Admin Fee- perhaps some of you veterans remember it. My gripe was, I couldn’t quite understand WHY letting agents charged tenants an “admin fee” when they were already milking landlords. The landlord is the customer, not the tenant. So I made the point that it was weird for lettings agents to charge consumers to consume.
Obviously, due to the fact I was covering such a riveting topic, the blog post received quite a few responses, which included several letting agents justifying the reasoning for charging tenants an admin fee. Apparently the fee is imperative to cover the costs of referencing the prospective tenants. Fair enough, I say reluctantly, as long as the fee isn’t extortionate (because there’s no need for it to be. But I still think the landlord’s fees more than covers those expenses). Either way, as with all my awesome posts, fun was had by all during the discussion. So if you’re reading this while you’re in the midst of sinking into your chair during the working hours of your bullshit job, surrounded by your bullshit colleagues, and contemplating whether life is worth living, perhaps you’d like to catch-up by reading the blog post linked above; otherwise it’s probably not worth it because there’s better shit to do in this world, and I’ve covered the gist of it anyways.
So, yesterday evening I was having a gander on Facebook and reading through my community’s status updates. One of my friends was having a bitch about a letting agent that was charging a ridiculous amount for a tenant application fee. I found it quite amusing, especially the comments, so I thought I’d share.
Bless my friend. She’s not the most coherent creature you’ll ever encounter, but you get the gist of her amusing tantrum. The agent wanted £240 for an application fee. The agent justified the price by suggesting they provide the best credit checks and references in the business. I’m going to go out on a whim and call bullshit. I don’t care if their credit checks/references come with 22 carot ribbons attached around them; there’s no way £150 + VAT for references can be justified, nor a £50 + VAT fee for a credit check. They use a third party credit check company just like thousands of other agents use; and those other agents seem to manage ok by charging a more reasonable application fee.
Here’s a list of Tenant Credit Check Services For Landlords – you can get checks done for free via Discount letting, while the others charge an average of £7. If agents want to make a small profit for arranging the credit check, then fine, by all means put a cherry on top, but make it reasonable and justifiable.
I went onto the letting agent’s website (R&P Lettings) and looked under the “Tenant info” section”. This is what they said about “References”:
As a minimum we will require satisfactory references from your employer (or college), a previous or current landlord, and a credit reference report. We may also require a personal reference, and sometimes a guarantor. We may use the services of an independent referencing company to obtain and evaluate these references.
That couldn’t sound more standard to me. Nothing special about it. Calling it “the best” is false advertising. I think my Facebook friend said it best- what a “fat little twat.” Out of principle, I would simply refuse to use agents that chat rubbish and charge unfairly.
Firstly, in my opinion, the agent needs to lower their bullshit tenant application cost. Secondly (while I’m in the midst of a rage), they also need to put a sledge hammer through that ‘Krusty the clown’ website of theirs; it looks cheap, and doesn’t fit nicely with their extortionate rates :)
I just explained the concept of letting agents charging both landlords and tenants fees to a friend of mine while he was towering over me, enquiring what I was blogging about. After I explained, he laughed and said, “Letting agents are benefiting from a double-ended dildo” Never a truer word spoken. And I think that’s how I’m going to end this blog post. Double-ended Dildo maaafuckers.
UPDATE (12th Jan 2012) – I just received the following email:
Dear sir
In regards to your Blog in which personal abusive and threatening attacks have been made against a member of my staff, and my company R&P Lettings. I have passed this over to the Police and my solicitor, they will contact you directly. They will also be in touch with the young lady.
1) I haven’t done anything illegal – what will the police do? 2) No one has threatened anyone.
I’m assuming it’s a sick joke conjured up by a 12yr old.
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32 Comments - join the conversation...
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Complete bullshit from the agent. I wouldn't use the agent if I knew they would charge my Ts that
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The high fee could encourage riff-raff, with the intentions of fooling the agent to think they have money. Works both ways, I guess.
@Armin
Thanks for the heads up! I've further defaced the screenshot :)
@NS1
She's do'able. Tight little package.
Yeah, I agree, I wouldn't use an agent that charged tenants that much either! I find the price completely repelling.
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The fee is needed to check status of prospective tenant, last time I checked its £7 per person and addres.the experian offer she quotes is an introductory offer and only available to the person.
As you can see from fb status it obviously works to get rid of time wasters also.
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I'll confess I was naive with my choice of agent: I never thought to ask the tenant fee sructure. But as that forms part of the total cost to the tenant I'll be interested in that next time round.
After all, what sensible landlord would want to use R&P (I assume it's short for "References Pricey") if they are out of step? Any similar property is £150 cheaper to rent so the tenant chooses that one instead. Poor old R&P landlord sitting their with a big void period, wondering why it does not get let out.
A somewhat theoretical point: So the fee strucutre is disadvantaging the landlord for whom the letting firm is acting as their agent. And under law of agency the agent can't act against the interest of the principle.
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You're right, it will keep the riff-raff away: But isn't that the point of the referencing?
It will also keep the well off away. They because well off by not wasting their money on overinflated "fees". Just the sort of tenant the landlord wants!
So the landlord's tenant market from P&R could become just the desperate and the stupid. What landlord wants stupid and deperate people living in their asset?
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It was only 2010, thats taking the p...oetic licence!
Still, its an improvement on some of last years shite, even if it is the same article re-hashed. Well done!
Just one constructive criticism, stop making up imaginary friends.
Youre a landlord, just 'cos youve credit checked them it doesnt make them your friend. Stalking is wrong- whatever its called.
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Their tenant charges are infact more reasonable than most of the larger agents. In my experience, if you want a good service it is well worth going to a reputable agent, and paying for it.
Keep up the excellent work R and P Lettings.
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I can understand them taking a small fee on top of that, but not in excess of £200 more
You say reputable but its not a registered company and can not see any trade organisations they are registered too. In addition the agent office is a home address?
Not very reputable and very expensive.
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"Dear sir
In regards to your Blog in which personal abusive and threatening attacks have been made against a member of my staff, and my company R&P Lettings. I have passed this over to the Police and my solicitor, they will contact you directly. They will also be in touch with the young lady."
Must be a joke. No one has threatened anyone. And I sure as hell haven't done anything illegal. What the hell will the police do?
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Bah, Freedom of speech.
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We conducted our own study that suggested fees were £80 - £375. Not only was this range the same in Newcastle & Manchester as it was in London, the average was actually slightly higher outside the capital. Given rents are much lower, this means tenants are paying a much higher proportion of the rent in admin fees before they can move into a property.
Tenants often have no idea about the size of these charges until they make an offer. But one of the remarkable things is how few landlords are aware that their tenants are being charged these fees. I guess they (understandably) think their tenant finding fees (which are on average nearly £1,500 per property in London) ought to be covering stuff like this.
I agree there's no problem with agents making a reasonable profit from providing services, but if the charges are so reasonable, why are they not more transparent? None of the agents we surveyed had these prices posted on their websites, we had to ring round them all and ask. Why the embarrassment guys?!
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Our £1k+ a month properties require much more thorough vetting than the DSS properties we manage due to increased "risk" in a bad tenant causing big issues with nicer properties.
One landlord asks for no checks, so we charge no admin fee. She is a oddity though.
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You could publish the fee structure? Or if it's more adhoc than that, you could at least give tenants an indication of the range of likely charges (with sufficient disclaimers etc)?
I actually don't think fees are likely to put tenants off, especially in the market we currently have where most of them will move heaven & earth to get a decent property at a good site. But it would increase the feeling of transparency, and might go some way to getting the relationship off on the right foot.
Of course my above point may explain it in some cases. It's in an agent's interests (not accusing you @YesAdam) not to publish these charges in case landlords become aware of them and start asking uncomfortable questions about the size of commission they are paying.
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I've read the blog posts just before you commented. I'm having trouble finding abuse. I'm finding lots of outrage and disgust, but no abuse.
It interests me that you don't appear to know the difference between abuse and disgust, bearing in mind you're accusing the contributors to this blog of having a limited vocabulary. And limited intelligence.
Just out of interest, am I one of the ones who suffers from limited vocab an intelligence?
Oh, and I notice you and Clare blogged at nearly the same time. Work in the same office, do you?
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In short, you've got nothing to worry about. You may want to contact the writer of the mail to see if they actually want to state their case and give them a fair hearing.
If you want any further advice, get me in our space on the Forum.
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It actually angers me that someone can claim £240 is for the best referencing - what utter nonsense!
Zoe Charters
www.sjestates.uk.com
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Tell em to f*** off or I will if you want? Could do with a pick me up and having a go a the director no less of a lettings agency could be just the job!
What does he/she want from you? An ickle apology and a peck on the cheek? Perhaps he/she should grow some chuddies and a thick skin because he/she is obviously not a business person who understands that any publicity is good (even I have just been to visit their site to see how good/bad it is)!
Perhaps the article is a little too close for comfort regarding extortionate fees and he/she does not want to try to justify them?
And finally to Jason - don't be so precious!
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I just want to mention rplets a few times to make sure this comes up on google when people search for them. R&P Lettings, infor@rplets.co.uk ... Ok, that's probably too much.
For tenants I think the key thing is to be prepared to ditch the property at the last minute on the basis of the fee. "Make it £100 or I go somewhere else". If an estate agent turns down your reasonable offer, how does that work for their client? Estate agents love springing this kind of thing on people, worth it just to see the look on their faces.
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High tenancy admin charges = some tenants put off = longer vacancy periods for the landlords who are paying an agent to let their property quickly!
The same is also happening with online letting agents. Obviously a competitive space where the majority are focussing on keeping thier landlord charges low. High tenant charges seem to be hidden in the T&C's or not mentioned at all - we've seen tenant charges at over £140.
At Nested, we keep our tenant reference charges reasonable and clear at £35. We also give the landlord the option to complete the referencing themselves if a tenant is particularly sensitive.
David
www.nested.co.uk
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I'd guess you're rather legally astute but if their solicitor follows up on their threat I'm more than willing to help you for free.
Alternatively, in keeping with the style of this blog, you could simply say "We refer you to the reply given in the case of Arkell v. Pressdram". He'll love that.
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Many thanks for your offer. Much Appreciated. I've not heard anything from the police or their solicitor so far :)
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Good observation. You're dead right. She's worth a spin :)
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I initially started this website because I wanted to document my every step from property idiot to property landlord,
in hope that people would find my site and help me along the way. I literally didn't have a clue about being a landlord
when I started this website.
However, such a high price could serve to help keep the riff-raff away.
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