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Council to launch 'ethical' lettings agency next month

A local authority is setting up a not-for-profit ‘ethical’ lettings agency and is aiming to woo landlords with a promise of no fees for tenants.

Guildhall Residential Lettings has been set up by Northampton council.

Conservative councillor Stephen Hibbert has told the Northampton Chronicle: “We’re going to target the people who are struggling to find a home, so it will help people in need like the disabled. Once the landlord knows they are on benefits, they tend not to take them on board. We will be willing to do that providing they can show a willingness to pay their rent through the benefit.”

Promotional material for the agency, situated on the council’s own website, says: “As an ethical social lettings agency, our terms of business are clear and simple. There is no small print, there are no hidden charges and, when we say we’ll do something, we do it.

“Landlords have told us that they want a good return on their investment. They have also told us that they want a letting agent they can trust, and tenants who look after the property, pay their rent on time and want to settle in the same place for a while.

“Guildhall Residential Lettings operates a private sector leasing scheme and provides a comprehensive and professional property management and lettings service. We provide expert, impartial advice on all aspects of leasing and letting and, by encouraging self-service and making best use of the latest technology, we are able to provide landlords and tenants with excellent, value for money services.”

While there are no fees for tenants there are plenty of them for landlords.

There will be a one-off set up cost of £500 to cover inventory, inspection and admin costs; then there’s a management fee of 12 per cent of the monthly rent; and there’s a tenant finder service which charges 50 per cent of the first month’s rent.

In return the landlord receives precisely 76 per cent of the market rent, a pledge that the tenant will hand back the property in good condition, and the possibility of interest-free loans to fund essential repairs.

Poll: Should councils set up their own lettings agencies?

PLACE YOUR VOTE BELOW

  • jeremy clarke

    So another council pledges to squander rate payer's money to set up a letting agency!
    Ethical?
    Just because fees are published doesn't make it ethical and making wooly promises before the doors are open is just so easy!
    Anyone can start a business if they don't have to worry about costs and overheads, how many councils have tried and failed at this now leaving vast black holes of costs?
    Councils would be better advised to spend public money ensuring that their houses were in order and that they were out in the field enforcing current legislation.

  • icon

    Be amazed if one landlord wants to pay them extortionate fees to get back only part of their rent, and hand their property to an ‘anti landlord’ council who’s priority is the tenant. Conflict of interest to say the least !
    Be interesting reading that management Agreement and tenancy agreements I have a feeling it won’t be like an agents and more just protecting the tenant

  • icon

    So they are charging landlords MORE than qualified local letting agents and putting tenants in the properties that are likely to be on Universal credit and likely to have no bond. Also being council run, does this mean they are closed weekends? Another stupid idea from local government!!

  • dale james

    very interesting how their no fees business model looks like high fees to landlords because of no tenant fees. They are not going to get the cashflow to survive as they will quickly learn the meaning of 'arrears' and 'void'! Not to mention the conflict of interest they will leave themselves open to with their landlords. But at least they see the prs as still an attractive business!

  • Spencer Fortag

    I am sure landlords will rush to secure a tenant paying 76% of market rent and a "pledge" that the tenant will hand the property back in good condition.

    And how does this work when local councils STILL advise tenants in arrears to stay until the bailiffs turn up? I can imagine the call now:

    "Hello Mr Landlord, I have bad news and bad news, what would you like first? Well, the bad news is that your tenant can not pay the rent this month as his benefits claims has gone wrong/has been denied/his circusmtances have changed (delete as appropriate). And the bad news is that we will not help you to evict them as we are advising your tenant to stay put until they literally get thrown out. That way we can re-house them in another sucker, sorry, I mean private landlords property. No sir, that is no problem, its all part of the service."


    What dim-witted, clueless, clutz thought this was a good idea? This is so stupid, I actually had to check it wasn't April 1st.

  • icon

    Golly chaps, I wish my district council would set up the same scheme, it would quickly make local landlords realise how very good we are by comparison! What a bonkers business model, so doomed to fail that it is a disgraceful waste of local taxpayer money.

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