5% Letting agent fees

[Phlash]

Because they are the one taking on the risk.

Agreed, they take on the financial risk but also get all of the capital gain. That risk relates to the potential reward of huge capital gains, which the agent cannot participate in.

They are paying to hand on the time, hassle and knowledge risk. Whether that is paid at market rate or at what the time analysis suggests is fair is the query I have raised in post 10.

The general answer, that the landlord has taken on the risk, is a capitalist answer. Yet the query attacking the agent is a socialist one. Surely, in order for such a debate to be a fair one, the attacks and defences have to come from the same agreed stance on the balance of capitalism and socialism?

[boletus]

Hello Phlash,

You misjudge me a bit there, I'm not arguing for the fairness of fees. If a letting agent can find a mug that will pay 15%, good luck to them. To me personally I wouldn't pay more than 7 and even then they would have to be exceptional.

As I said earlier, we digress, 7% for competent full management (all in) is out there already, rightly or wrongly. 5% all in for a competent agent is a growing possibility the way things are going.

On my local high streets, it seems every Tom, Dick and Harriet are taking on lettings which is pushing down fees. Whether they can survive or not on that commission is immaterial to me.

I take your earlier point about 5% not being the true rate but the 15% scammers will also whack on another 3-5% hidden fees if they can get away with it. Caveat emptor.

[boletus]

Hehe - I thought that might provoke some conversation!

I would be very interested to see MTGs breakdown as a piece of analysis, if you do find it MTG, let me see it.

I think these might be the threads;
http://www.landlordzone.co.uk/forums...+agent+teacher

http://www.landlordzone.co.uk/forums...t=26843&page=2

[mind the gap]

I think these might be the threads;
http://www.landlordzone.co.uk/forums...+agent+teacher


http://www.landlordzone.co.uk/forums...t=26843&page=2

Oh, well winkled out, boletus! I couldn't find 'em anywhere.

That Agent JJ didn't come back, did he...?!

[boletus]

That Agent JJ didn't come back, did he...?!

Highly skilled professionals like that can't afford to waste time bantering.

At those hourly rates you already had a grands 'worth' of valuable opinion.

[mind the gap]

Highly skilled professionals like that can't afford to waste time bantering.

At those hourly rates you already had a grands 'worth' of valuable opinion.

Ha! True, true. Why don't I feel guilty?

And the nomination for the Most Greasy and Patronisng Performance by a New Member goes to...'Property Pete'. Sadly, he never came back to claim his award, either.

[midlandslandlord]

My - while stirring :-) - view is that LAs entering debates should check the detail of their analysis !

If you had 100 properties managed for which you received £25 per property per month, you'd receive £25k per annum. Let's assume that is enough for a member of staff and associated overheads. I'll tell you now, 100:1 ratio is too high and a decent ratio, I would argue, needs to be at 50:1 as a maximum.

Put me in a Treasury and call me anything but Gordon, but I make that £36k not £25k.

The extra 11K being the bonus , or alternatively Letting Agents working in teacher-years (!).

I make that 7% OK when you apply the adjustment to Phlash's conclusion, 5% probably too low. And I roughly agree with that.

For LLs employing staff the ratio seems to be that one 'property manager' can manage 100-200 properties, but then they have less general buggeration and files, and no need to manage customer relationships with landlords, except one.

ML

[YesAdam]

We provide the best service to a landlord at 5%, but that is due to the large quantity of properties she has put under our management.

A 1 property landlord should not expect 5% fee, it just wont cover costs. Unless LA also charges itemized on top of that for every time LA lifts a finger.

Maybe as a introductory fee? OR A very new agent needing landlords, experience and knowledge?

[mind the gap]

Unless LA also charges itemized on top of that for every time LA lifts a finger.

A letting agent charging extra every time he lifts a finger?

Surely not.

[YesAdam]

LOL, you can find LA that don't do itemized billing. Generally we charge finder fee and pct. If its property is distant we charge for travel. Other than that its all included, except conflict resolution with benefits/court/tribunals.
I will con-seed you wont find many like our good selves.