Peter Girling, Chairman, Girlings Retirement Rentals comments on Shelter’s call for a Ban on Letting Fees.
Shelter has called for a ban on ‘out of control’ letting fees, which they say average around £350 per tenancy, but can be over £700.
They are calling for agencies to be barred from charging ‘administration’ and ‘holding fees’, which in some cases are non-refundable, even if the agreement falls through.
Whilst there are undoubtedly unscrupulous letting agents out there, most are not and the reservation and administration fee reflects a contribution by the tenant to the cost of the work involved in referencing and processing the legal paperwork before a tenancy commences.
The idea that the customer contributes to the cost of setting up a long-term financial transaction is well established and not confined to the residential lettings industry. The essential thing is for agents to ensure that their fees are reasonable, justifiable and most importantly, transparent.
Setting up a tenancy requires skilled and trained staff, especially for agents like ourselves that deal with vulnerable groups such as the elderly. While there will be many tenancies which proceed smoothly there will also be many which turn out to be complex and costly for the agent.
The fees, being set out in advance as they should be, have to reflect the average cost of processing a transaction rather than the actual cost of setting up each tenancy. This means that some people will always question why they should pay a fee for what appears to them to be a simple transaction.
I think if more agents explained what is involved in setting up a tenancy, and the circumstances under which it will be refundable then people would start to understand why they are necessary.
The fee demonstrates a firm commitment between landlord, agent and prospective tenant and provides a disincentive to prospective tenants making multiple reservations simultaneously.
Uncommitted reservations potentially cause costly and unnecessary work for landlords and their agents and also deprive other potential tenants of a possible home. The fee enables the landlord to refuse other potential tenants, secure in the knowledge that the applicant is committed to the property.
Girlings is a privately owned company which deals exclusively with renting private retirement property to the 55+ market throughout the UK on assured tenancies. Over the past 20+ years we have rented purpose built retirement properties to thousands of retired people on Assured Tenancies.
We are licensed members of ARLA and NALS and I would urge anyone using a letting agent to only go through accredited agencies to ensure best practice, as well as making sure they know the fees they will be charged up front so they can make a decision whether to do ahead or not.
Article provided by – Girlings Retirement Rentals