A London letting agent has admitted that he is at loggerheads with another letting agent –over its fees.
Mark Wilson, managing director of Globe Apartments, an RICS member, said his daughter, a university student sharing a house, is being ‘ripped off’ by an agent in Leeds.
He said: “Five girls sharing paying agency fees of £150 each for a tenancy agreement is excessive.
“I told my daughter she was being ripped off. Her reply was, that is how it is if you want to rent. What got me even more annoyed was that the agent wanted to charge the same ‘admin fee’ again on the renewal of the tenancy!
“So far I haven’t paid it. I am waiting to see if it will be deducted from the deposit at the end of tenancy.
“If the deduction appears on the closing statement I intend to cite the Advertising Standards Authority decision and the threat of Trading Standards.
“The [agent’s] action breaches Consumer Protection Regulations, which are another set of powerful consumer rights in place for tenants to use against the endemic ‘rip-off culture’ associated with the letting industry.”
Globe Apartments, says Wilson, is one of the very first agents to detail in full all its charges on its own website and elsewhere.
Wilson said he fully agrees with the ASA decision, that tenants should know the costs associated in renting a property from the outset.
He said: “These charges can differ significantly from one agent to another, so it’s a no-brainer for tenants to be able to research and compare the charges of local agents, especially when the same property is being offered to let by competing firms.”
He added: “Moving in to a new rental is often a time when resources are limited, so surprises are not welcome, especially when that can mean several hundred pounds of additional charges. The threat of prosecuting agents might be enough to compel them to play ball and disclosed their charges.
“Differential agency fee pricing could also bring a boost to the local specialist letting agency compared to the glossy chain firms; some having additional charges that squeeze the pips out of their tenants before they even move in.”
Globe Apartments is currently waiving all tenants’ fees altogether for new ASTs completed before the end of June. Its normal tenants’ fees are £130 for up to two tenants, or £50 per person for three tenants and above. It also charges £60 renewal fees per tenancy.
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Comments
@the reason we have a bad rep -
You can have as many as you want on a tenancy agreement. Technical,you hit the four limit, which means the four tenants have an equitable share in the tenancy, and the additional above four are tenants in trust of the others, but in the real world this makes absolutely no difference.
Back on topic, Student lets entail fair more work but £150 per head seems excessive.
We charge £60 a head for student lets (we have around 140 student lets and 60 private, and the student lets are an absolute nightmare to close the apps).
This is an angry dad who is probably comparing apples to oranges.
Shameless sales pitch on the one hand, and confusing the issue on the other. The agent's fees may be high, but as long as they are clearly published in advance, the consumer can make a qualified decision, and market forces will dictate. Like Globe Apartments (a RICS member) there's an agent in every town that discounts, so if admin fees bother you that much, go rent from them instead.
I recently paid around £500 to have my car serviced at the main dealer - ridiculously expensive, but I knew in advance, and had the option of going elsewhere.
Transparency - yes 100%. Intervention in the pricing of privately owned businesses - no.
If your intention was to highlight transparency , the rant about your daughter being ripped off was not the best way to do it, you have confused two issues.
The fact is, like it or not your daughter has entered a legally binding contract, (offer acceptance and consideration) to pay fees of £150 to the agent. The contract is not as far as I can make out unfair. So a that talk of not paying it is means nothing. Perhaps you Ray or IO can explain which bit of lettings regulation top trumps the laws of contract.
You claim the Agent action has breached CPR but have not shown or explained how. Which part of CPR caps agents' tenancy fees at a certain level?
@Mr Wilson
Sorry I must interpret words differently yo uou but there are plenty of comments in this thread about the fee not being unreasonable.
The rest of your comment to me I just do not understand especially the bit about changing sides I have no idea at all what you are on about - maybe you don't either?
I am all for regulation, 100% always have been and for private Landlords too. No-one should be able to let except through an authorised, accredited, licensed, properly monitored agency
Mr. Wilson,
Just give the agents name - you must have it together the written facts of your complaint. Perhaps objective and sensible opinions can then be made?
Mr Wilson,
Oh dear i think this is more to advertise your own company.
We all have our fee's. You daughter could have looked elsewhere.
Can i ask you this, is £900 for a one page sols letter just?
No not really but I chose to pay it without tell all because I needed their services.
I am truly appalled at the tirade of vitriolic scorn and conjecture that has been displayed here by some posters. It is no wonder that a large proportion of the uk public think we are the devil's own spawn when we respond like this, on a public forum, to one of our own.
Perhaps Mr Wilson was ill advised to throw in an advert for his own company's charges when he could have used an unnamed example but he is quite right to rail at the £150 per person charge for a 5 person let. It may be that he didn't know all the facts, but even so we are talking about £750 to prepare an agreement! a ridiculous figure in anyone's world and especially so if asked for again at the point of renewal.
If the standard of spelling, and the interpretations of the legislation that affects us, of some of the posters is in anyway indicative of their standards of service, then God help the industry because no one else will.
My point was that when you stand back and look at our industry objectively, transparency is a good thing. It is good for the consumer, as they know where they stand, but also for the agent as they are being are upfront with their customers from the outset. Transparency is good for competition.
Change is inevitable, so we should embrace it and see it as a tool for our commercial advantage.
I was surprised none of the comments focused on the key message, which was that with agents fees varying, tenants should shop around. Smaller agents, which I am proud to be one of, can try to capitalize on improved transparency. I thought the ASA decision was well-considered and in light of that, we also intend to include details of the required security deposit with all of our marketing to further assist our customers.
We no longer live in a ‘caveat emptor’ world, however much some might wish we did.
I am sure we all like to see fair play in how we make our living and how we are treated as a consumer. I highlighted a personal example as it was relevant in the context of agency fees, their perceived reasonableness and the transparency of disclosure.
A nice surprise to see some realistic responses rather than the usual pitchfork waving when letting agents are referred to.
I would just add to some previous points that Student Lettings are often far more frustrating to setup than a normal tenancy. In most cases each tenant requires a guarantor which increases the paperwork significantly.
They are rarely plain sailing. Each guarantor will usually make demands that Joint and several liability is removed from the agreement as their beloved Timothy would never do anything wrong. Explaining to five parties that this wont be removed takes hours. When I ran an Oxford agency, the parents would then have their solicitors ring up and try the same tack. We could spend days on the phone trying to reach an agreement between five parties and the Landlord.
It's easy to presume an amount quoted is a 'rip off' but some context needs to be applied. We charge significantly less for a standard residential tenancy, a bit more for a company let and more still for student properties.
The Bond Retention Scheme is ignored by agents and flawed, without any real justification is to claim the flat was dirty, the carpet stained, the cooker a mess, landlords goods missing (1 cup, 3 wineglasses) or you used drugs which meant toxic substance removal and you're sunk. You can go to any alleged public body for help and be listened to and that's all. These Orgs all have 100 000 current cases similar to yours - so what did you expect. What chance do you have, none. o.k. you know the law, you know your rights so issue a summons- it gets thrwon in the trash can, your Judgment is worthless and try enforcing it. You can't. And get in my car and I will show you the homes of 6 millionaires who thank God each day for the Landlords Deposits handed to them,
It you don't pay the renewal it will just become a periodic tenancy and no renewal fee will be payable.
The Dispute Service expressly forbids deducting agency fees from the deposit, so they won't be able to deduct the money from that.
what a muppet
Are you absolutely sure the "Agent" in Leeds is actually an Agent? By far the biggest accommodation provider to Students in Leeds isn't actually an Agent but a landlord who rents their some 400 properties out of offices that look like an Agency.
It would be wrong to slate Agency for the fees charged by a landlord wouldn't it?
As for you IO I can't see anyone has claimed the £150 is justified. the bit that has whizzed people up is the fact Mr Wilson has seen fit to vent his "seethings" publically. Bad form enough but given he is simply incorrect on all of the points he has raised, he is simply pouring fuel on the RICS agenda for regulation.
I didn't have you down as naive but when legislation is headed back to the commons for their approval to regulate lettings agents and force them to register with the ombudsman do you not think it timely that what ought to be a private discussion is so publically aired?
If you have switched sides to the Shelter, Prisk, Bolton King Hayter camp do the decent thing and come clean.
This is an over-egged story with an agenda.
He sounds like those parents we get calling us about why does my son or daughter have to do this and why do they have to pay on time, there loan is delayed. We tell them the mortgage company doesn’t care.
Mr. Wilson knew the cost upfront before his daughter moved in he knew the cost. He should have said to his daughter I cannot justify the expense find another property, they could have found a property from a private landlord and paid no fees.
The service his daughters letting agent provides may justify a £150 fee per person, good staff are expensive, overheads, referencing tenants properly, guarantor checks, verifying them it costs money. Just because ‘Globe Apartments’ runs a service where they offer free things doesn’t mean we have too.
Pizzahut pizza £18.99
Aladdin’s pizza £4.99
The choice is yours!
God help Mr Wilson when his daughter announces she taking a place through Foxtons.
Becca
Not surprisingly I agree with your points!!
I knew as soon as I saw the item what the likely attitude would be, that yes it is advertising for his firm. And that agents would leap to defend such ludicrously high fees.
But what I did not expect was the invective and almost bile that ensued given that no-one else does actually know all the facts or indeed family relationship, why the tenancy went ahead (yes it is a free choice to a degree) etc etc.
Heaven knows I get criticised often enough for jumping to comment too soon and not knowing all the facts, but my past sins and omissions pale into insignificance compared to some of the wholly unjustified comments that followed mine.
One rightly says if they are 5 separate agreements it may look less unreasonable, but the article opens with comment that it is sharers and "a tenancy agreement".
Anyone who thinks these fees for one agreement are reasonable and justifiable is living on another planet, as they are if they think the same is fair for a renewal. And are asking for trouble and to be beaten with the unreasonable fees stick that is now being waved around.
One last point. I'll bet deposits were taken from these 5 tenants (Mr Wilson I'd like to know what money was taken well in advance of completion and what it was called) and not treated correctly by this agent. OK I don't know all the facts but looks like an even money bet to me.
Agents please when in a hole (not a CJ Hole boom boom!!) but do stop digging and do stop defending the indefensible as by doing so you do your industry no credit or service and only invite further wrath and criticism from those keen to kick you because it shows how out of touch you are.
It is alright for Mr Wilson to rant at another Agent but when anyone points out the fragility of his position and his ignorance of the legislation concerned , they are wrong? quite unbelievable really. Is he your Dad by any chance.
£150 in isolation is a high fee but without knowing the terms, the rent and all the other considerations no-one can comment whether £150 is high, low or just right.
As for how the public consider the letting industry, an ill founded personal attack by the MD of a lettings firm, displaying ignorance of the legisation governing his own industry must be very reassuring to them.
I personally think that the intollerance of what in reality is a pompous self-righteous attempt at PR is well founded.
When you look at the unpleasant nature of some of these posts, can you wonder that letting agents have a bad name. You may not agree with Mr Wilson (although I personally do) but he does appear to be taking a principled stand on the matter of his own fees and Industry Observer (second one to post on this story) made the point that Mr Wilson is quite correct on a £150 fee per tenant being ludicrous. I agree with Industry Observer, no wonder Agents are getting themselves into such a precarious position on fees.
I do think that those who have posted their unpleasant thoughts should really consider how they are helping to portray the Lettings industry.
Are you as daft as Mr Wilson? He is not posting as an Agent but as a malcontent father who is displaying an unhelthy ignorance of the law given his position.
If the was taking a proper stand and knew his stuff it would be different but his is one of those parental rants more experinced be headteachers when a child has been bullied.
Perhaps RICS could run a CPD course on contract law and unfair contract terms, as one of their members could do with a bit of a brush up.
I agree with Observer this is embarrassing, but not just for his daughter, his fellow directors will be wishing he had kept the company name out of such a public dummy spit.
Good for Mr Wilson - his fees ARE clearly displayed on his site and are reasonable. He is quite right to point out that another agent charging £150 per student tenant is ridiculous. It is exactly why letting agents find themselves in this position now over their fees. Is there really anything wrong with an agent taking a stand?
The fees of £150 maybe the norm in the area, one has to wonder what the fees for other services would be, solicters,dentists, are they on a standard rate card, are thier prices advitised on web pages, do they differ in different parts of the country? you bet they do, it is called that old comodity used since man kind walked on this earth, demand and availability, if the ASA want to regulate one industry, lets have it done for all.
Father should know what the world is made of, he is in it, if any thing, like my doughter, knowing her father wrote the comments she would really be totally embarrassed.
Just because he runs a cheap agency does not mean he should start a race to the bottom on fees.
Raise your service levels and you can charge more.
MR WILSON! (couldn't resist it) is £450 for a drive by mortgage valuation a rip off
how about £750 for a 20 minute homebuyers report?
Best part of £2000 for a structural survey full of one liners
Seek Quallified Gas Safe report
Seek Electricians repot
Advise Darinage inspection for further detail.
Presumably you consider the RICS's £150 CPD courses a rip off too? after all, all that information is available free from the internet.
“Five girls sharing paying agency fees of £150 each for a tenancy agreement"
1. If sharing one property and all paying £150 for one tenancy - check it's validity as joint tenancy's are capped at 4.
2. If paying £150 each for their own separate tenancy - check HMO compliance.
Like Mr Wilson's daughter has got a more informed view of reality than Mr Wilson himself.
If the daughter does not like the fees payable to the agent of the property she wants, she and her friends are free to find somewhee else. If however they have worked out that they save more than £150 over the course of the tenancy because the rent or bus fares are cheaper the whole economy of the property in question has to be considered.
What I supect Mr Wilson doesn't like is:
1; he is the one paying the £150
2 one of his competitors albeit awy from his patch is more commercially aware than himself.
Mr Wilson is obviously not a great father, telling his daughter she is getting ripped off! I ask you.
He is the one pi55ed off , not her, get over yourselgf Mr Wilson. Sit in a quiet room with a book or the internet and work out that the Agent in question has not breached any regulation. Also work out that your daughter and her finds might very well end up with a CCJ that will cost them very dearly if they refuse to pay their contractural obligation.
The only way you will get out of paying the fee is if your daughter is a minor.
£150 is a weighty fee but that is after all what she signed up to, a bit more guidance before she left home was the time to prepare your daughter for the cruel contractual world she was entering. Bellyaching so publically now makes you look a bit of a fool.
You pays yer money you takes yer choice
Caveat emptor
Well done jesus, i want to work for free one day as well.
By citing the recent ASA ruling (which was made long after his daughter moved in) he's simply using his inside knowledge of the industry to bag a better deal for his daughter. I guess I can't blame him for that, but to try and get some free PR out of it is distinctly naff.
That said, I know one well established agent in Leicester is a crook because I was guarantor for my step-son when he rented a flat through them (they didn't realise I was in the trade because they referenced me as a Director of my limited company, the name of which bears no resemblance to my trading name).
They failed to register the deposit, attempted to charge him the full replacement cost of kitchen worktops for some minor scratches and told him, in writing, that he could only apply to get his deposit back after he had paid for the new worktop.
Needless to say they were unsuccessful. Perhaps I should have named and shamed them on LAT.
Advertising his own company or not, those fees are extortionate and the agent is clearly taking advantage of students who a) don't know any better as it is their first time renting and b) have just received a lump sum from their student loan. Not acceptable.
I like the bit about his daughter, a student, telling him, a managing director of an estate agents (I wonder how's my directors he manages?) that that's how it is if u want to rent. Hilarious.
No sympathy. She seemed happy to pay it based on the tone of above. If you don't like it go elsewhere. It's either stupid daughter or softy Daddy. Yes it's a rip off. But who is to blame? Not the agent. Read your small print before signing and no problems.
Confucious, he is clearly advertising his own company and full of his own importance. His defence of his little princess comes a poor second. How does he know the costs of that particular agent? Would he appreciate any of his clients parents telling him he was charging too much?
I note that he charges "renewal" fees of £60 +VAT when renewal fees are themselves a rip-off since tenancies can become periodic.
No wonder agents are the latest whipping boys when agents like this attack other agents.
Doesn't change the fact he is correct.
£150 per applicvant for referencing them and then preparing one agreement with all 5 namres on is ludicrous - and agents wonder why they are getting themselves into a tricky position on fees?
And then to charge £750 again when all that is needed is to change a few details on one page of an existing agremeent, and then add a new start and end date?
Wonder what they charge if the tenancy goes periodic that would be interesting to know.
Helping his daughter or advertising his own company?