Posts with tag: letting agent fees

Agents warned to streamline their processes ahead of fee ban

Published On: September 13, 2017 at 9:19 am


Categories: Property News

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A new warning from automated rental payment provider PayProp states that letting agents must be fully prepared for the upcoming ban on upfront fees charged to tenants.

The firm suggests that the way to do this is by streamlining their processes.

Ban on Fees

A ban on letting agent fees charged on tenants is widely expected to be implemented throughout England at some point in 2018. A debate on the ban took place in Westminster just last week.

In Wales, there is a similar consultation ongoing. Fees have been banned in Scotland since 2012.

It is feared that the majority of letting agents will lose a significant proportion of revenue when any such ban is introduced. As part of its consultation, the Welsh Government reports that fees charged to tenants make up around 19% of an agent’s income.

A separate study undertaken by software provider Eurolink calculated that the ban could cost a single office agency £85,000. For a multi-branch network, this could rise to £850,000.

Agents warned to streamline their processes ahead of fee ban

Agents warned to streamline their processes ahead of fee ban

Neil Cobbold, Chief Operating Officer of PayProp in the UK, noted: ‘It’s clear that we could soon reach a point when upfront letting agent fees charged to tenants are banned in all corners of the UK.’

‘That’s why it’s important that agents begin to plan now for how they are going to replace lost revenue – whether through alternative revenue streams, optimisation of business processes for better efficiencies, or through low-overhead growth.’[1]

Concluding, Mr Cobbold said: ‘The ban on letting agent fees is all about a changing market and effective adaptation. The agents who plan their strategy now are likely to be most successful when a ban is finally introduced.’[1]




31% of landlords unaware of proposed letting agent fees ban

Published On: September 7, 2017 at 8:59 am


Categories: Landlord News,Tenant Fees Ban

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A new survey has revealed that nearly one-third of buy-to-let landlords are unaware of proposals to ban letting agent fees.

The research from property management platform No Agent, coinciding with yesterday’s discussion on the letting agent fee ban in Westminster, discovered 31% of landlords are oblivious to the potential ban.

Ban on agent fees

In last year’s Autumn Statement, the Chancellor announced the proposals, leaving many to air concerns that these fees will be shifted to landlords. Inevitably, these costs will need to be recouped elsewhere, more than likely through higher rents.

Many experts suggest that banning letting agent fees will end up impacting on tenants – the very people the Government is trying to help. However, landlords are also unlikely to escape unscathed.

Additional findings from the survey show that 35% of landlords agree with the Government’s arguments that the ban will force agents to become more competitive and to provide a better service.

46% feel that a deposit cap of one month’s rent – which was yesterday agreed would be exempt from any ban- would make landlords less likely to rent properties to tenants with a poor credit history.

In addition, 37% of landlords agreed that if the deposit was to be capped at one month’s rent, they would be less inclined to rent to tenants with pets or children. 57% of landlords believe a cap on letting fees for tenants will work better than an outright ban.

31% of landlords unaware of proposed letting agent fees ban

31% of landlords unaware of proposed letting agent fees ban


Calum Brannan, CEO of No Agent, noted: ‘It is time to bring the rental sector into the current day and remove the inefficiencies it has been plagued with for so many years, and this bill marks the beginning of this change.’

‘It’s worrying to see the awareness of the proposed tenant fee ban amongst landlords is so low, particularly given how much of an impact this will have on their current business models. More needs to be done by the Government to ensure this vital group know what is to come into effect in 2018,’ he continued.

Concluding, Mr Brannan said: ‘We do believe the ban will force further transparency in the lettings market, which is ripe for disruption and requires a complete overhaul. We very much hope, along with the 37% of landlords of this country, that this ban will force letting agents to become more efficient, and adopt technologies and new processes that will save money for all parties involved, including tenants.’[1]







ARLA Propertymark Responds to Welsh Consultation on Lettings Fee Ban

Published On: September 4, 2017 at 9:02 am


Categories: Property News

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ARLA Propertymark (the Association of Residential Letting Agents) has responded to the Welsh government’s consultation on its proposed lettings fee ban.

The consultation, which launched on 19th July, proposes a ban on letting agents charging fees to tenants.

ARLA Propertymark Responds to Welsh Consultation on Lettings Fee Ban

ARLA Propertymark Responds to Welsh Consultation on Lettings Fee Ban

It now looks likely that tenant fees will be banned throughout the UK; Scotland already has a ban in place, while the English government has committed to introducing a ban, which is likely to take effect next year. Northern Ireland also had a consultation on a proposed ban, which closed in April.

The consultation in Wales follows pressure from the likes of housing charity Shelter. In March 2016, Shelter Cymru published the report Letting go: why it’s time for Wales to ban letting agents’ fees.

It said that there were large discrepancies between fees charged to tenants, ranging from a low of £39.99 to £480. The report also found that one in three tenants who use a letting agent paid over £200 in fees to begin a tenancy.

The consultation document says: “In terms of reforming the private rental sector, the Welsh government has already gone much further than other parts of the UK in regulating landlords and letting agents through Rent Smart Wales.”

This is a compulsory scheme by which all landlords must be registered and all letting agents must be licensed. Many landlords will also have to be licensed, based on whether they perform property management tasks.

The consultation says that while letting agents are required to display their fees, a mystery shopping exercise found that half did not.

The Welsh government believes that many fees charged to tenants are “unjustified and arbitrary”.

The consultation asks a number of questions, aimed at determining “which fees, if any, are justifiably being charged to tenants”.

It also seeks information on fees paid by landlords to letting agents and the possible consequences of a fee ban.

David Cox, the Chief Executive of ARLA Propertymark, responds to ARLA’s submission to the consultation: “Any move to ban letting agents fees in Wales will cause unprecedented damage to the rental sector across the country. Independent analysis commissioned by ARLA Propertymark, following the UK Government’s announcement of its own ban, revealed that if a full ban was introduced, rents will increase by £103 per year, which will only serve to financially punish long-term tenants.

“In our submission, ARLA is calling for fees associated with referencing to be left out of any ban. Right to Rent checks will soon be a service that agents in Wales will be required to undertake by law, so it is only right that agents should be able to recover the associated costs, given the time and resources needed to carry out such checks.”

The consultation closes on 27th September.

It can be found here:


Letting Agents & the Tenant Fee Ban – How do you Beat It?

Published On: August 23, 2017 at 8:14 am


Categories: Property News,Tenant Fees Ban

Tags: ,,,

James Batham, Managing Director of Spire Landlord Solutions

Over the last ten to 15 years, letting agents have faced ongoing changes to legislation, new regulations and red tape. The latest proposed change, the tenant fee ban, has caused quite a stir in the industry, and those who had hoped it may fall by the wayside will have been disappointed to see it outlined in the Queen’s speech on 21st June.

It has been estimated that between ten to 25% of letting agents’ income could become wiped out if the bill is introduced, with the Association of Residential Letting Agents’ (ARLA) Capital Economics Report, Letting the market down?, unveiling that tenant fees currently make up around a fifth of an agent’s income.

So what does it mean for you as a letting agent? We have spoken to fellow letting agents, landlords and industry insiders from across the country on how they are preparing for the proposed changes and suggestions for sourcing new ways of income. Here’s five of our top picks:

1) Create time to attract new customers

Attracting more customers to replace your tenant fee income seems like a no-brainer. Unfortunately for many, marketing your own business is often overlooked when daily operations and property management take up the majority of letting agents’ time.

Letting Agents & the Tenant Fee Ban – How do you Beat It?

Letting Agents & the Tenant Fee Ban – How do you Beat It?

As the old saying goes, time is money – and action may be needed to improve the efficiency of your business. Consider what tools and services are out there right now that you could introduce to make life easier and simpler for you and your team. For instance, implementing an external service that takes away the pain of property maintenance, emergency calls and endless paperwork will free up some time in order to focus on bringing in new business.

2) Target the right customers for you

For most letting agents, the ideal customer would be a large portfolio landlord who wants to invest with you, make use of all your services and is in it for the long haul. So what’s the best way to reach these customers?

Market yourself as the local expert and talk to your customers about what matters to them most. Speaking to a former employee of a national landlords’ association highlighted that keeping up with the latest regulations and obligations can be a worry for landlords, however, local issues directly affecting the local property market can be the cause of even more stress.

Although marketing how good you are as an agent is important, investing time to showcase yourself as a local expert is equally as useful when trying to establish new relationships as it creates trust. Networking events, sharing tips on social media, writing a blog post or even writing to your local newspaper are all great ways of sharing local property information and talking to landlords about things they most care about. As a result, you may find more landlords will engage with you and maybe keep you in mind for the next time their tenant hands their notice in.

3) Add extra value to your service offering

One very successful agent told us that the onus was not solely on the amount of landlords you have on your books, but up-selling and cross-selling services were also key to growth.

Introducing new services to your existing offering can provide a great opportunity to add a new source of income. For example, adding a 24/7 service meets the needs of today’s 24-hour culture. The good news is that manning an office 24/7 is not required – more and more agents are looking into how their services can be extended out of hours.

Look at implementing online systems so that you can to be contactable at all times of the day, or work with an external partner who has a 24-hour call centre which can sometimes be cheaper, and mean landlords and tenants can physically speak with someone if they have an issue when your offices are closed.

Offering new services to your existing landlords can often be an easier sell, as you have already established a trusting relationship. Agents are the experts and, if they have the trust of their landlord and can show the added value in investing in the additional services, then landlords are willing to part with their money. Rather than simply increasing landlord fees to make up for lost revenue, if you can add services that benefit both you and your clients, you are in a position to earn more pounds per deal.

4) The battle of the fees

Almost every landlord we speak to wants the same thing from a letting agent – someone they feel they can trust and who will look after their property as if it’s their own; they very rarely mention landlord fees. Many agents we speak to are looking at rival fees and trying to undercut them, but that isn’t every landlord’s priority when selecting their agent of choice. So instead of slashing your prices, ensure that your reputation for providing a high-quality service is the deciding factor for new customers and for those you want to retain.

Take extra steps to add a real premium level of service which benefits the landlord – save them time and money. For example, adding insurance products i.e. emergency property cover,  will protect the landlord against unexpected repair bills/costs and open yourself up to a pool of potential new clients whilst beating off your competition.

5) Make yourself indispensable

Whilst of course some landlords have the time, knowledge and will to self-manage their properties, the fact of the matter is that letting a property is not as easy as some landlords may think. There are hundreds of laws and regulations when operating in the private rental sector – so use these to your advantage. You are the expert in the room, so make sure your landlord or potential landlord client knows it, so they are happy knowing that their property is best left in your capable hands.

Spire Landlord Solutions specialises in providing 24/7 Home Emergency Insurance for letting agents, housing associations and landlords with multiple properties. For further information on our services and how we can add value to your business click here.


‘No evidence’ as to why Welsh tenants should pay letting fees

Published On: August 22, 2017 at 11:05 am


Categories: Property News

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The Welsh Government has stated that buy-to-let landlords should be responsible for paying letting agent fees in the country. This comes despite concerns that any such move will lead to higher rents, as landlords seek to pass on any costs, according to the Welsh Government.

A report from the Government claims that there is ‘no compelling evidence’ for tenants to pay letting agent fees or renewal costs upfront. This is because, ‘the large majority of the work undertaken by agents is work that the landlord would otherwise be doing themselves.’


In addition, the report acknowledges that ‘referencing tenants is a service to landlords, not tenants’ and there is, ‘work involved for agents setting up a new tenancy.’ It is also argued that they, ‘do not generally make excessive profits on set up fees in relation to costs incurred.’

The report went on to say: ‘Inventories and tenancy agreements do protect both parties from false accusations, but it is soon to be a legal obligation on the landlord to provide a tenancy agreement, and therefore it is a service to the landlord to do this job for them.’

‘Arranging viewings and advertising a property are also a service to landlords, just as a job advert 60 is paid for by the employer, and estate agents charge sellers, not buyers, to advertise their home.’[1]

'No evidence' as to why Welsh tenants should ban letting fees

‘No evidence’ as to why Welsh tenants should ban letting fees


Just last month, the Welsh Government launched a consultation on banning fees to tenants, following an announcement that it will be taking action in order to prevent unfair fees.

This consultation looks to seek views on the nature and level of fees being charged to tenants. Alongside looking if these fees are justifiable, it also looks to gather information on fees paid by landlords to agents and any consequences of proposed bans.





Government Plans will Outlaw Tenants with Pets, Believe Landlords

Published On: June 27, 2017 at 9:48 am


Categories: Landlord News

Tags: ,,,,

The recently confirmed Government plans to ban letting agent fees charged to tenants – announced in the Queen’s Speech – and a cap of one month’s rent on deposits will outlaw tenants with pets, among other vulnerable renters, believe landlords.

Government Plans will Outlaw Tenants with Pets, Believe Landlords

Government Plans will Outlaw Tenants with Pets, Believe Landlords

The Tenants’ Fees Bill will implement the policy to ban landlords and letting agents from taking any payments from tenants, with the exception of rent, a security deposit, a holding deposit and tenant default fees.

In the initial consultation on the fees ban, where the Government announced its intentions to look at putting a cap on security deposits, the National Landlords Association (NLA) attempted to argue that it was unnecessary.

Although it is not the intention of the tenancy deposit cap, the Government’s plans will inevitably reduce landlords’ willingness to accept tenants with pets, by removing their flexibility to take a higher deposit to cover any damage caused by the pets.

Previous research from the NLA shows:

  • 47% of landlords were unwilling to allow tenants with pets
  • 41% of those cited the reason as potential property damage
  • The average deposit taken by a landlord was 4.92 weeks’ rent

Furthermore, The Dogs Trust’s Lets with Pets scheme advises landlords to either take a higher deposit from tenants or include a “professional cleaning on move-out” clause in the tenancy agreement, to mitigate the financial risk of property damage.

Not only do the Government plans discourage tenants with pets, but they would also affect tenants with bad affordability status, bad credit, those without a guarantor, families with children and those in receipt of benefits – often the highest risk tenants who are usually required to pay higher deposits.

Veteran landlord and spokesperson for the Midland Landlord Accreditation Scheme (MLAS), Mary Latham, comments on the plans: “I have accepted tenants with pets for years, because a home is not a home without a pet. I have never had to withhold monies from deposits because of issues caused by those pets, and my tenants stay longer because they feel more at home.

“I am so angry that this will force many landlords to rethink the risk and prevent pet owners from renting nice homes. Government are so out of touch with the reality of the lives of those who they are meant to represent.”

Will the Government plans discourage you from letting to tenants with pets?