Following on from the recent decision by the Scottish Government to ban letting agents and landlords from charging extra fees for checking credit references and drawing up an inventory, research released by the largest housing charity in the UK, Shelter, has revealed that a staggering 1 in 4 people claim to have been charged what they described as “unfair” administration fees during their dealings with letting agents.
The practice of charging administration fees for obscure services is not uncommon, but in many cases the fee is grossly out of proportion to the amount of work actually carried out: in some instances, tenants were charged £150 for an annual credit check, a task that would have cost as little as £8 to do.
And in many cases, these so-called “administration fees” were non-refundable. Some letting agents were found to be charging tenants and landlords for the same services, charging for property viewings or making up bogus fees to increase profit margins, and in one recorded case, a landlord paid £9k to a letting agent and lost the lot when the agent failed to hand over any rent or deposit money before dissolving the business.
But until letting agents are regulated there will always be a small minority of agents who continue to rip off landlords and tenants by taking advantage of the surging demand for rental properties in the UK. So if you intend on using a letting agent to help manage your buy to let property, make sure you know exactly what you are paying for.
