jaykerr Posted March 5, 2008 Report Share Posted March 5, 2008 Hello All, I am completely new to this having just rented out my flat via an letting agency. I went to the agency today to receive the monies involved and complete the documentation. Due to haste and not read the fine print I have now got worked up on the fees I see detailed in their documents. As discussed from the outset the agency said they would take an 8% fees for finding me tenants or 10% for the management of the property. I went with the 8% and feel I should be able to manage the property myself. Having found tenants through the agency, they have drawrn up a 12 month contact with an option for the tenants to re-consider after 6 months. i.e get out of the contract at that point. All fair up to this point. However the agency I realise now have taken 8% of the gross rental income I will receive for the first 6 months and have detailed in the contact they will receive a further 8% for as long as these tenants remain. This is where I get angry and frustrated as I cannot see how the agency can feel worthy of claiming 8% of the rental income for the forseeable future. I naively thought the 8 % would have been for the initial payments the tenants would make as a down payment. I really cannot believe this to be standard practice and hence why I am writing this in the hope somebody can offer advice to me. Yes I know the small print I should have read, but I am wondering whether there is a route such as a period after signing the contract which I can challenge these charges. I really feel they are trying to take me to the cleaner due to my haste in having to get to work on time this morning. Any advice is greatly appreciated. Regards, Jay Link to comment Share on other sites More sharing options...
Simon Dewsberry Posted March 5, 2008 Report Share Posted March 5, 2008 Hi Jay Finders fees vary from agent to agent ...... Some charge a fixed fee .....i use one that chatges my a flat rate of £150 per tenancy another 1 weeks rent another 2 weeks rent some charge a months rent ...some charge more ...... you need to negotiate a deal you are happy with at the start.....WITH NO FURTHER CHARGES for T continuing to occupy prop OR any percentage of sale price when selling prop ........ See http://residentiallandlord.ipbhost.com/ind...?showtopic=2403 and search the forum for more threads on this subject The Rodent Link to comment Share on other sites More sharing options...
Trenners Posted March 5, 2008 Report Share Posted March 5, 2008 Hi BemusedLandlord, Well - as you say - you should have read the small print. I think the 8% "for life" fee is unfair and I am sure other members will point you towards the case against Foxtons (that is being looked at by the Office of Fair Trading) as it seems that your chosen letting agent is offering the same sort of "service". However, I would also comment that Letting Agents are a business and not a charity. If you really wanted to minimise your fees then you should have found a tenant yourself. To only expect to pay 8% of the 1st months rent for the introduction of a tenant is as big a joke (from a letting agents perspective) as the charging of 8% of the rent for life (from a landlords perspective). In my area, letting agents offering an introduction only service can charge upto 1 months rent + VAT. This would equate to about 8% of the rent for the 1st 12 months. I know that fees will vary from area to area but you should certainly expect to pay around £400+VAT for this type of service. I hopes my answer makes you less bemused ! Mark Link to comment Share on other sites More sharing options...
jaykerr Posted March 6, 2008 Author Report Share Posted March 6, 2008 To only expect to pay 8% of the 1st months rent for the introduction of a tenant is as big a joke (from a letting agents perspective) as the charging of 8% of the rent for life (from a landlords perspective) Hi, Thanks for your replies on this, To reply to the above, I do appreciate that the agencies need to make their turnover and the fact that in my case the 8% plus other fees came to a rough total of just overs 50% of one months rent or £700. Which is as mentioned and I believe to be fair also. Its the ongoing income they receive for doing absolutely diddly that I find unjust. Which is what I am going to contest with them, failing to rectify this matter by discussion. Can anyone advise me on what may be the best route of action to take on this? Regards, Jay Link to comment Share on other sites More sharing options...
Simon Dewsberry Posted March 6, 2008 Report Share Posted March 6, 2008 Great if a 12 mth ast ....BUT 8% of yrs rent on 6 mth ast is a complete NO-NO ....!!!! (16% pa) when you may/will have to stumo it up again ...... Now that you are aware ....get your negotiating head on B4 reading and signing agreements ....... Personally i will not pay more than 2 weeks rent per tenancy .....so if LA doesn't want to work for that ..then he/she/they does not work for me at all ...... My arrangements with LA are usually a bit more complicated as the fee is less £75 which i charge to LA/T Because i do referencing/inventory/ast/ bond protection ...so all they have to do is "find" a T i then take over ..... In my experience this is the only way to get the job done properly .....( i do have one LA who i "allow" to do the "admin" but using my ast NOT theirs !!) Best route of action "see you in court !" The Rodent Link to comment Share on other sites More sharing options...
plym77 Posted March 6, 2008 Report Share Posted March 6, 2008 just out of curiosity, is the second hit of 8% based on them signing a new contract to tie the tenant in for a further six months or is it based on the tenant being in situ at 6 months 1 day irrespective of whether it is a new tenancy or a rolling contract at that point? If it is for the agent to deal with a new six month contract then you should probably expect to pay for this service... although of course you can deal with these yourself but may already now be tied. If it is the latter then it may be a little unfair as at 6 months 2 days they could hand their notice in and then you will have paid 8%, plus then whatever your new tenant find would be. Perhaps some form of negotiation may be in order if the latter is the case - particularly in view of the fact that for an extra 2% you could have full management! FYI I paid in the region of £500 plus VAT for a tenant find the first time around which in fact meant I will have paid marginally more than 8% for the first six months. My point being that a tenant find isn't cheap wherever you go. Link to comment Share on other sites More sharing options...
Matthew Posted March 7, 2008 Report Share Posted March 7, 2008 "FYI I paid in the region of £500 plus VAT for a tenant find the first time around which in fact meant I will have paid marginally more than 8% for the first six months. My point being that a tenant find isn't cheap wherever you go. " One ad in gumtree = 5 minutes in time, £0 in cost Arranging and doing viewing the next day for 10 poeple = 1 hour for block viewing, 30 mins to arrange, £0 in cost Tenant found (take holding deposit), get information required for rentcheck and submit online = 30 minutes, £20 in cost (which can be charged to tenant) Do inventory, Sign contract (take remaining payment) and hand over keys = 1 hour, £0 in cost. Protect deposit = Don't know how long (30 mins?), £0 in cost. Job done! Total cost to landlord = £0, total time taken landlord = 3 hours and 35 minutes. This works out (£500 + VAT) £164 per hour. My work pay me £14.58 per hour, so my comparible cost = £52.20. My point is there is a £535.30 difference in cost here. I have used an example of a flat I let out above, and I admit you may need to do more viewings to find a tenant.....but even so. There are always people out there that want to take your money away from you, asking no questions & not negotiating allows them to do this. Quite clearly Rodent can get them to do it for £150........so why does everybody else just accept having to pay huge fees, which in no way relate to the service being provided....... They are not doing a HIP replacement, nor attemping brain surgery...... so why pay them to? Link to comment Share on other sites More sharing options...
Simon Dewsberry Posted March 7, 2008 Report Share Posted March 7, 2008 Here , here !!!!!!!!! and you will probably do the job better ....as you will have infinitely more interest in your asset then the LA ever will... The Rodent Link to comment Share on other sites More sharing options...
CH1 Posted March 7, 2008 Report Share Posted March 7, 2008 When I used a LA last time it cost me £150 to find a tenant, (including AST, Inventory, take deposit) they were good, unfortunately they've moved out of the letting field (and now do serviced apartments) and I was left with all the big named LA's who charge in the region of £295-£395 +vat in my area (without inventory), tops £400 in my area (but those are the ones that speak very nicely on the phone and then actually don't do anything!). So this time round I am doing it myself and like Matthew said have had ad on gumtree nd a lot of response where I can deal direct with potential T and arrange viewings ASAP. Mostly, its been good, the only downside is when T's don't show up for appt! However, can appreciate not everyone will have time to do viewings especially if property is hundreds of miles away! Ideally, I'd like to strike a deal like Rodent and get LA to find T do viewings etc and I do the rest! I've learnt from a previous experience to read all LA terms of contract before signing them as so many of them have clauses added about wanting 2% if selling prop. (assume thats on fully managed props.) and clauses about charging £25+ vat each week if you withdraw if they didn't find a T, if they didn;t find T they didn't do their job, so try to chose agents that have no hidden fees for withdrawing or staying or selling etc. Good Luck. Link to comment Share on other sites More sharing options...
Matthew Posted March 8, 2008 Report Share Posted March 8, 2008 Re CH1's comments. It is a big problem tenants not turning up. I did have about 6 people (individuals not together) booked up for viewings one night and none turned up. This is why I try and book everyone in between an hour session. Usually I may have about 10 booked and maybe only 4 or 5 will turn up, but at least I haven't wasted my time. I have a property a few hundred miles away, an HMO. I agree I couldn't go and do viewings, so I pay a tenant (rent reduction) 50 pounds per month to do it for me. It has been working very well, she gets to vet the prospective tenants, gets paid for it (isn't that much effort either) and is good value on my side. Always ways around problems! Link to comment Share on other sites More sharing options...
seantyrer Posted March 12, 2008 Report Share Posted March 12, 2008 Hi there, I am very interested in the topic of letting agency renewal fees as we are helping landlords with legal advice who wish to challenge their letting agents over payment of renewal fees. There is lots of information about this issue on our website http://rentmanagement.co.uk if any landlords are interested in exploring their options etc. Kind regards Sean Tyrer Hutcheon Solicitors Link to comment Share on other sites More sharing options...
CH1 Posted March 12, 2008 Report Share Posted March 12, 2008 Hi there, There is lots of information about this issue on our website http://rentmanagement.co.uk if any landlords are interested in exploring their options etc. Kind regards Sean Tyrer Hutcheon Solicitors Hello Sean, As it happens I had just came across your site earlier and was reading about rent management/collection service you offer (from £15 per tenancy?) but wasn't clear if that is just over seeing the financial side of the things i.e just rent collection and non payment or do you liaise directly with tenant? or to landlord and then back to tenant? Link to comment Share on other sites More sharing options...
seantyrer Posted August 14, 2008 Report Share Posted August 14, 2008 Hello Sean, As it happens I had just came across your site earlier and was reading about rent management/collection service you offer (from £15 per tenancy?) but wasn't clear if that is just over seeing the financial side of the things i.e just rent collection and non payment or do you liaise directly with tenant? or to landlord and then back to tenant? Hi there and apologies in the length of time taken to reply to your question. The Rent Management Service is available via 3 service plans (Gold, Silver and Bronze Plans) all service plans include rent collection, the issuing of bespoke Rent Payment Cards to tenants (so they can pay cash at any Post Office or Paypoint Outlet) and a Personal Account Manager to liase between our landlord clients and their tenants. I hope this answers your question and I have added the links to the 3 service plans below. http://www.rentmanagement.co.uk/pages/Gold-Service-Plan.html - Gold Service Plan http://www.rentmanagement.co.uk/pages/Silv...rvice-Plan.html - Silver Service Plan http://www.rentmanagement.co.uk/pages/Silv...rvice-Plan.html - Bronze Service Plan Kind regards Sean Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.