ARLA calls for better letting agent regulation!
ARLA has called for better regulation of letting agents when it comes to tenant fees.
The organisation's managing director David Cox said that while these fees are necessary, a minority of agencies are overcharging.
"This is where better regulation is needed in the private rental sector to ensure consumers are not taken advantage of. We want to see tenants paying a fair price for the service they receive. Regulated agents don’t charge excessive fees," he stated.
Mr Cox said letting agents need to charge tenant fees in order to carry out actions such as reference checks, drafting a contract and managing any extensions or renewals. However, he added that with a correct pricing structure in place, most agencies do not make a noticeable profit on these items.
A survey carried out by ARLA found 74 per cent of agents licensed by the organisation charge no more than £250 in tenant fees. On average, its members charge £213 to cover the lettings process, a fee it described as "reasonable".
Reference checks are the service most likely to require a fee, with 98 per cent of agents charging for this. Some 69 per cent charge for drawing up a tenancy agreement, while 65 per cent do so for tenancy renewals.
More than half (57 per cent) of ARLA licensed agents said they charge a single fee that encompasses all of these items, rather than charging for each individually.
"Renting a property is a big financial commitment and tenants should be made aware of what exactly they are being charged for," Mr Cox stated.
Earlier this year, Direct Line for Business claimed some rogue letting agents are 'double dipping' by charging both tenants and landlords for the same service.
Jasvinder Gakhal of the organisation told Property Reporter this minority of rogue operators are doing an injustice to the law-abiding majority.
Research from Direct Line found the typical landlord who uses a letting agent spends 11 per cent of their revenue on the service.
As an ARLA qualified letting agent, here at Belvoir Lettings West Derby we charge a set fee (set fee regardless of how many people apply for the property, not a fee charged to each applicant). This fee includes employment references, previous landlord references & credit checks. If a guarantor is needed there is a further charge (but even with a guarantor our fee is less than what is classed as "reasonable"). All the write up of tenancy agreements and tenancy renewals are included in our initial fee and further charges do not apply, this is important to us and we believe in being fair to all our clients including tenants & landlords. Our landlord's do not get charged for the same service as our tenants, we do charge to cover the cost of marketing the property, carrying out viewings and ensuring the property meets legal requirements to advertise and tenant find (i.e Landlord's Gas Safety Certificate, Energy Performance Certificates etc), this again comes as a set fee depending on the service is required by the Landlord. For information on our services, please contact our team on 0151 256 0880.