Citizens Advice calls for ban on letting agent fees

Citizens Advice is stepping up its calls for a ban on lettings agent fees following a surge of complaints from tenants.

The organisation claims there should be one charge paid for by landlords as they are in a better position to shop around.

Citizens Advice says students and young people aged 17 to 24 are typically worst hit.

It says it helped people with 6,500 problems with letting agencies between July 2015 and June 2016, a 14% rise from the 5,700 problems reported two years ago.

The biggest rise was among 17 to 24-year-olds who sought help with 810 problems with letting agents in the last year, compared to 360 cases reported between July 2013 and June 2014.

Gillian Guy, chief executive of Citizens Advice, said: “Letting agents are hiking up their fees for a service that’s often not up to scratch.

“With fees rising year on year for letting agents, many tenants will rightly be wondering why they are paying hundreds of pounds for a simple contract renewal or for management services that leave them waiting months for essential repairs.

“It is concerning that younger renters are among the most likely to report problems with a letting agent, when many will end up using letting agents to find somewhere to live at university.

“Private renters shop around for properties, not for letting agents. Landlords are better able to choose agencies based on performance and cost, and it should therefore be landlords paying letting agent fees, not tenants picking up these rising costs.”

Responding to the report, David Cox, managing director of ARLA, said: “Picking the correct letting agent is an important starting point for students and young people renting their first home. One way of staving off any problems before, during or after a tenancy is to register with an ARLA letting agent, all of whom adhere to a strict code of conduct.

“This will help ensure tenants receive a high-quality professional service from the letting agent managing your tenancy.

“As well as regulating the services of letting agents, ARLA agents also monitored their costs. Letting agent fees cover the cost of essential items during the lettings process such as credit searches, right to rent checks, the drafting of the tenancy agreement, inventories and the management of tenancy extension or renewal. All of these items cost the letting agent money to carry out, and the fee covers the costs of these.”

Isobel Thomson, CEO of the National Approved Lettings Scheme, said: “The majority of letting agents provide an excellent service, but if they are not behaving professionally, or upholding their side of a contract then we absolutely expect tenants to report them. NALS wants to see more of this, to help stamp out the bad practices that put tenants at risk and affect our sector’s reputation.

“When it comes to fees, accessing any form of housing comes with a cost, and renting in the private rented sector is no different.

“It’s important to remember that letting agents are running businesses, and like any business should be able to reasonably charge for the work they do. The key word here is ‘reasonable’ – some of the fees stated in the CAB report are clearly excessive and are not typical of the average fees NALS agents charge.”

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Written by: Houseladder