'Out of control' letting agent fees are forcing tenants to go without food, says Shelter

Housing charity discovers agencies were charging renters more than £350 on average to set up a tenancy, on top of deposits and up-front rent

Housing charity Shelter has launched a campaign to end letting agency fees which are costing renters hundreds of pounds.

Shelter carried out mystery shopping research with 58 letting agencies across the country and found that all of them charged fees to renters to set up a tenancy, as well as deposits and rent in advance.

Average fees charged were almost £350, but almost a third of agencies charged renters more than £400 to set up a tenancy, and a further seven more than £700. These charges are in spite of the fact that letting agencies typically receive separate fees from landlords to set up a new tenancy on their behalf.

In some of the letting agencies investigated by Shelter, fees charged to renters – sometimes hundreds of pounds - were not refunded even when, through no fault of their own, the deal didn’t go ahead.

Shelter is calling on politicians to end letting agency fees charged to renters to set up a tenancy, including ‘administration’ fees, ‘holding’ fees, credit check fees and ‘check-in’ fees.

Franco Cirillo, Director of Dorrington Residential, one of London’s largest residential landlords and which is backing Shelter’s campaign, said: "It isn’t right that prospective tenants are asked to pay hundreds of pounds in fees, as well as deposit and rent in advance, for a service that landlords commission. We only work with letting agencies who agree not to charge renters any fees at all. It means that we can focus on the rent, and clear up any confusion about who letting agencies are actually working for."

Campbell Robb, Shelter’s Chief Executive said: "This shocking research reveals that letting agency fees are out of control. Anyone who’s tried to find a rented home in the past few years knows that affordable, decent places to live are in short supply, and often snapped up within hours. The high demand for rented homes means that renters can’t shop around, but instead have to deal with the letting agency their landlord has chosen. They have no choice but to swallow their anger and stump up their cash.

"People often forget that the landlord is the real customer of a letting agency, but the fact that renters also pay fees leaves both expecting the agency to act in their interests. This adds up to a confusing situation that leaves landlords in the dark and renters powerless.

"The only way to fix our broken lettings market is for the Government to stop renters being charged for the costs of setting up a tenancy. This would put landlords in a stronger position to negotiate the best deals, restoring healthy competition to the market and releasing renters from the burden of paying out hundreds of pounds in sky-high fees."

Caroline Kenny, Executive at the UK Association of Letting Agents (UKALA) comments: "We are completely against overcharging. UKALA members operate under a strict code of conduct that helps ensure communication, transparency and fairness underpins all dealings, financial or otherwise, between landlords, letting agents and tenants. Unfortunately however, there are unscrupulous agents operating within the industry who are overcharging tenants and damaging the industry with their dishonest practices.

"UKALA believes that agents should ensure that any fees and charges are made clear in advance of entering into any business relationship. Crucially, so long as information about potential costs is provided in an accessible, transparent and understandable manner, consumers can decide on where to place their business based on all the relevant information.

"Matching prospective tenants with suitable properties is resource intensive and can be extremely costly. The bulk of any agency's costs are covered by the fee paid by their landlord client. However, it is not always appropriate for the landlord to meet pre-tenancy costs, particularly when they are associated with proving the suitability of an applicant. It is therefore appropriate for a prospective tenant to contribute towards the administration and referencing process before a tenancy begins. This demonstrates commitment to the prospective tenancy, safeguards against an applicant securing multiple properties simultaneously, to then reject all but one at the last minute, and protects agents and landlords from applicants who provide false information.

"Tenants ultimately benefit from these processes being carried out professionally. Proper process, such as the inventory check-in and check-out, helps to protect the tenant."

Discover more property articles at Homes and Property
Arts and Entertainment
Attenborough with the primates
tvWhy BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter
News
Campbell: ‘Sometimes you have to be economical with the truth’
newsFormer spin doctor says MPs should study tactics of leading sports figures like José Mourinho
Sport
football
Life and Style
Agretti is often compared to its relative, samphire, though is closer in taste to spinach
food + drink
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Bookkeeper / Office Co-ordinator

£9 per hour: Recruitment Genius: This role is based within a small family run ...

Recruitment Genius: Designer - Print & Digital

£28000 - £32000 per annum: Recruitment Genius: This Design and marketing agenc...

Recruitment Genius: Quantity Surveyor

£46000 per annum: Recruitment Genius: This property investment firm are lookin...

Recruitment Genius: Telesales / Telemarketing Executive - OTE £30k / £35k plus

£18000 - £35000 per annum: Recruitment Genius: This company specialises provid...

Day In a Page

War with Isis: Fears that the looming battle for Mosul will unleash 'a million refugees'

The battle for Mosul will unleash 'a million refugees'

Aid agencies prepare for vast exodus following planned Iraqi offensive against the Isis-held city, reports Patrick Cockburn
Yvette Cooper: We can't lose the election. There's too much on the line

Yvette Cooper: We can't lose the election. There's too much on the line

The shadow Home Secretary on fighting radical Islam, protecting children, and why anyone in Labour who's thinking beyond May must 'sort themselves out'
A bad week for the Greens: Leader Natalie Bennett's 'car crash' radio interview is followed by Brighton council's failure to set a budget due to infighting

It's not easy being Green

After a bad week in which its leader had a public meltdown and its only city council couldn't agree on a budget vote, what next for the alternative party? It's over to Caroline Lucas to find out
Gorillas nearly missed: BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter

Gorillas nearly missed

BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter
Downton Abbey effect sees impoverished Italian nobles inspired to open their doors to paying guests for up to €650 a night

The Downton Abbey effect

Impoverished Italian nobles are opening their doors to paying guests, inspired by the TV drama
China's wild panda numbers have increased by 17% since 2003, new census reveals

China's wild panda numbers on the up

New census reveals 17% since 2003
Barbara Woodward: Britain's first female ambassador to China intends to forge strong links with the growing economic superpower

Our woman in Beijing builds a new relationship

Britain's first female ambassador to China intends to forge strong links with growing economic power
Courage is rare. True humility is even rarer. But the only British soldier to be awarded the Victoria Cross in Afghanistan has both

Courage is rare. True humility is even rarer

Beware of imitations, but the words of the soldier awarded the Victoria Cross were the real thing, says DJ Taylor
Alexander McQueen: The catwalk was a stage for the designer's astonishing and troubling vision

Alexander McQueen's astonishing vision

Ahead of a major retrospective, Alexander Fury talks to the collaborators who helped create the late designer's notorious spectacle
New BBC series savours half a century of food in Britain, from Vesta curries to nouvelle cuisine

Dinner through the decades

A new BBC series challenged Brandon Robshaw and his family to eat their way from the 1950s to the 1990s
Philippa Perry interview: The psychotherapist on McDonald's, fancy specs and meeting Grayson Perry on an evening course

Philippa Perry interview

The psychotherapist on McDonald's, fancy specs and meeting Grayson Perry on an evening course
Bill Granger recipes: Our chef recreates the exoticism of the Indonesian stir-fry

Bill Granger's Indonesian stir-fry recipes

Our chef was inspired by the south-east Asian cuisine he encountered as a teenager
Chelsea vs Tottenham: Harry Kane was at Wembley to see Spurs beat the Blues and win the Capital One Cup - now he's their great hope

Harry Kane interview

The striker was at Wembley to see Spurs beat the Blues and win the Capital One Cup - now he's their great hope
The Last Word: For the good of the game: why on earth don’t we leave Fifa?

Michael Calvin's Last Word

For the good of the game: why on earth don’t we leave Fifa?
HIV pill: Scientists hail discovery of 'game-changer' that cuts the risk of infection among gay men by 86%

Scientists hail daily pill that protects against HIV infection

Breakthrough in battle against global scourge – but will the NHS pay for it?