Tenant lobby group Generation Rent has renewed its call for the Government to ban letting agent fees for tenants, after finding that some renters are charged up to £780.
“Rip-Off” Letting Agent Fees Cost Up to £780, Says Generation Rent
Earlier this year, the group began researching more than 700 agents across the country. It found that fees vary massively for what it considers a standard service. It says that this shows how letting agents are charging disproportionate fees to those stuck in the private rental sector.
The website showcasing the fees, lettingfees.co.uk, shows that the average fee for a two-person household is £386, on top of rent, deposit and moving costs.
While four agents do not charge anything, the highest fee for two people is £780, charged by Skampi in the London Borough of Tower Hamlets.
Since the Consumer Rights Act 2015 was introduced, letting agents have been required to publish their fees. However, the research found that 14% of agents do not comply with the law, and could be fined £5,000.
Working alongside technology firm Inkleby, Generation Rent and its volunteers have gathered fee figures from letting agents in eight London boroughs and across Manchester and York. The findings will serve as a guide for tenants in those areas, so that they can avoid sky-high fees.
The Director of Generation Rent, Betsy Dillner, comments: “Competition for homes is fierce, so tenants aren’t in a position to avoid paying letting agent fees, and agents often charge what they like. If tenant fees were banned, agents could start competing properly for business, and tenants wouldn’t have to dip into their savings to be able to move home.”1
A recent study by housing charity Shelter shows that first time buyers will need to earn £64,000 per year by 2020 if they wish to purchase a home.
With prices set to continue rising, demand in the private rental sector is expected to remain strong.
Meanwhile, we recently reported that those buying properties in London need deposits up to 170% higher than those required in the rest of the UK, highlighting the vast difference in the housing market around the country.
1 http://uk.businessinsider.com/letting-agent-fees-range-from-zero-to-780-for-no-apparent-reason-2016-4