MP: Letting agents
are ‘out of control’
Government denies action is necessary
Claims by private tenants and the shadow housing minister that letting agents fees are out of control have been denied by the government.
There are nine million private renters in Britain.
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| Big Issue North magazine article |
In the past they would have generally dealt directly with landlords of their properties. But the increase in the buy-to -let market has created a rise in letting agents, who market the property, conduct viewings, check tenants’ references and take the first rental payment and deposit. Landlords are typically charged around 10 per cent of the rent by the letting agent.
Documentation fee
When Charlotte, a young disabled woman from Leeds, found an advertised property she believed was suitable for her needs she was asked to pay a documentation fee of £36 by the letting agent.
“Since I can only work a few hours each week and rely on benefits I asked if the landlord would be willing to take me as a tenant before I paid the fee,” she said. “I was told that this would be fine but I would also need to pay £60 on top for a guarantor to be checked.”
She paid this money, which was non-returnable.
She said: “A week later I was told the landlord had found ‘a more suitable tenant’. As my credit check was fine the agent showed me other properties. But they had nothing suitable as I require ground floor access. Thus I had to look elsewhere and I lost the £96.
“I have managed to find another property through another letting agent and that has cost £320, of which £200 has been converted into part of the deposit. It’s still a lot of money and I am fortunate as I have some savings and a supportive family.”
In 2012, the Scottish government prevented letting agents from charging any fee beyond rent and a refundable deposit. Opponents of the change argued it would lead to an increase in rents but there appears to be no evidence of this.
‘End free-for-all’
In 2014, Conservative and Lib Dem MPs blocked an attempt by Labour to ban letting fees for the rest of the UK. Labour’s shadow housing spokesman John Healey said: “Letting agents are out of control, with millions paying hundreds of pounds to secure somewhere to live. The government must end the free-for-all.
“Regulation is needed to improve conditions for tenants – many of whom are being forced to rent privately because they are priced out of home ownership – and
to make the market work more fairly, efficiently and transparently.”
to make the market work more fairly, efficiently and transparently.”
Big Issue North sent a series of questions on letting agents to the Department for Communities and Local Government. Its spokesperson responded: “The vast majority of landlords and letting agents provide a good quality service to those looking for a home in the private sector.
“The government believes that ensuring full transparency is the best approach in tackling unfair letting agency fees, which is why we introduced legislation in the Consumers Rights Act 2015, which, since May 2015, requires letting agents to publicise a full tariff of their fees.
“DCLG publishes a How To Rent guide that is updated regularly.”
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