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View Full Version : Tenants staying in - renewal fees for letting agent after 4 years too high



man1
09-12-2011, 12:28 PM
We rent out a property for £1100 a month and we fully manage it. Our current tenants, who are really good, wish to stay on for a 4 th year. Our letting agent is not willing to budge from a 5% fee (£828) for just renewing the contracts which I know I could do myself!
It is our fault. We rushed into letting when we were forced into holding onto the property after the sale fell through. we were fortunate enough to be able to keep letting it out but I just feel, every year, this fee is too high for him doing not much. I have asked him to reduce his fees and he won't and says we agreed to this when we took out the initial contract. We are in Hertfordshire which may make some difference!
Are we able to get rid of him without losing the tenants?!!!
Thank you anyone who takes time to respond!

Armin
09-12-2011, 13:00 PM
£828? That pays for a nice holiday for your tenants, temporary storage and moving company costs, if you catch my drift. Have a close read through the contact you have with your agent about what you can and cannot legally do.

jta
09-12-2011, 13:01 PM
Just allow the tenancy to become a 'Statutory periodic tenancy' Your agent can do nothing about it, although they will still be able to collect their monthly commission from the rent.

LesleyAnne
09-12-2011, 13:08 PM
As jta says, there is absolutely no need to renew a contract every year. Tenants automatically get a statutory periodic (monthly) tenancy once their fixed term contract expires. I have let my flat for 11 years, to 3 different tenants, and every 1 had a 6 month initial contract, then went to a periodic thereafter. 1 tenant stayed for over 5 years without ever renewing!

Tell Agent (yes you employ them so you dictate the service you require), that you want tenant to move to an SPT. Tenant still needs to give you a month's notice if they want to leave, and you are still required to give them 2 months, but everything else, all terms, conditions and clauses in the original agreement are still valid and binding. You can keep the agent on to manage without paying this extortionate fee for no reason other than to line the agents pockets and pay for their staff Christmas drinks!

Interlaken
09-12-2011, 13:38 PM
I agree with all the above (not sure about Armin's comments) but you could also try approaching the agent in writing and asking how much he wants to end the contract you are currently in.

Banzai
09-12-2011, 13:45 PM
and we fully manage it.

Do you manage the let or does an agent, are you paying a monthly fee or an annual contract renewal?

theartfullodger
09-12-2011, 14:42 PM
Think admin means end current tenancy (eg section 21), checkout Tenant AND agent, have a one week gap, then start new tenancy with same Tenant but your paperwork & no payments to agent
Suspect that's the only way to end the shacking to the agent.

Interlaken
09-12-2011, 15:21 PM
Would be nice to think so Artful but most contracts specify that if a tenant has been introduced the to landlord by said agent any further business connected with another rental or sale means a commission is payable.

man1
10-12-2011, 08:12 AM
Thanks for taking the time to advise us. We pay an annual fee but will definitely look into the statutory periodic tenancy (hadn't even heard of it!).
Am a bit scared of being taken to court! My husband is refusing to pay him any more money! We have a copy of an agreement but i now need to see if we've signed it.
I just think it is extortionate and the silly thing is if he'd have reduced the fee by even £100 we would have stayed and felt happy.
Thanks again

midlandslandlord
10-12-2011, 10:03 AM
Essentially you've been fleeced by your agent.

Case Law is developing in this area, but it sounds as though you may not be covered and it heavily depends on your contract with the agent.

See
http://www.lettingfocus.com/2009/07/foxtons-loses-unfair-letting-renewal.html

You may need specialist advice from an appropriate solicitor, and at £800 a year it may be worth it.

Others know more on this than me.

ML