Following the example of several other councils, Wrexham County Borough Council has decided to run its own letting agency in direct competition with private letting agents in the town.
The move follows several proposals that had been put forward for revenue generation by the cost cutting council, which held discussions previously about if such a service could be run jointly with Flintshire.
The published business plan indicates the possible difference in pricing between the Council’s agency and commercial agencies:
“For tenant finder only service these will for a one off payment of £100 registration fee and a cost per unit of housing allocated of £75 with housing management service provision at a cost to the Landlord of between 7% and 10% of rental income per unit. These costs are competitive in comparison to typical local commercial letting agents operating within the County Borough whose charges for ‘let only’ range from £175 – £275 and management fees range typically between 8-12% of monthly rent.”
Controversy has raged over whether Councils should go hear-to-head with local private providers in other fields, in particular where councils provide a local newspaper, something the government has threatened to step in to control, as a threat to a free press.
Wrexham Council told www.wrexham.com:
“A team will be working with local private landlords to offer a range of accommodation to tenants who may not be able to access accommodation via the private rented sector, whether it is through homelessness, low income or an immediate housing need.
“Private landlords who join the Local Lettings Agency will be offered a continuous source of tenants, maximising occupancy and rental income. They will also have access to an experienced staff team with a wealth of local knowledge and a commitment to providing the highest level of service.
“The service is available to private landlords in Wrexham County Borough, whether they are a new investor with a single property, or an established professional with a large portfolio. Flexible letting packages can be offered at competitive rates.”
Wrexham’s lead member for housing, Cllr Ian Roberts, said:
“I am delighted that we have established the local lettings agency. This is a golden opportunity to help the homelessness situation, which has been well documented nationally.
“This initiative is proactive and will help not only those people who ask for our assistance as they are homeless, but help landlords too. It is essential that we act now, given the potential for an increased risk of homeless people.
“Extensive work has been done to create this scheme and we will do everything we can to make it a success.”
A previous report indicated that Vibrant and Viable Places (VVP) grant monies was being used for start-up and some ongoing costs:
“VVP funding of £100,000 in 2014/15 to support establishment of the LLA has been factored into the attached financial projections for year 1. The financial profile is based on the assessed take up of properties within the scheme. Based on a 55 property portfolio established in year 2 this shows a deficit of £4,436 in that year. This figure would need to be accommodated from within existing departmental budget. An estimated portfolio of 110 properties results in a projected surplus of £23,002 by year 3″
The Agency will initially work from Council offices, but if it grows it is expected to have its own premises in the town centre.
— LandlordZONE® (@LandlordZONE) August 14, 2015