January 17, 2017
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| Gemma Anders: 'Landlords and agencies are exploiting the fact that we don’t have any choice' CREDIT: ANDREW CROWLEY |
Britain’s growing army of tenants are worried that the Government will delay or quietly drop its promise to end the scandal of arbitrary fees charged to tenants in return for... often nothing.
Chancellor Philip Hammond pledged to ban the fees in his Autumn Statement, winning praise from tenants’ rights groups and dismay from letting agents.
These fees have become so large that Mr Hammond’s announcement resulted in a 13pc fall in the share price of Foxtons, the high-profile, upmarket London estate agency.
The charity Citizens Advice has found that one in five tenants has to pay fees of £100 or more to start and to renew a tenancy.
But for professionals renting expensive properties in London and other city centres, they can be far higher. And the chronic shortage of rental property means most have no choice but to pay.
The Government’s proposed consultation has not begun. Nor has a date been set.
Gillian Guy, chief executive of Citizens Advice, said: “The Government’s pledge to ban letting agent fees is welcome and should put a stop to private renters being ripped off.
"But it needs to be enforced sooner rather than later, or letting agents will continue to cash in while they still can.”
Telegraph Money has been approached by many readers who have recently been required to pay higher fees. In many cases agents are not disclosing fees on their websites – which is itself a breach of the rules.
Foxtons’ customer Gemma Anders has been locked in a dispute with the estate agent over the state of her rented flat in Fulham, west London.
The central complaint regarding the fees is that while tenants have to pay them, they have no rights or entitlements as a result.
Gemma Anders’s battle with Foxtons began when her bathroom sprung a leak. The 28-year-old, who is a manager in a London department store, and pays £1,300 a month for the one-bedroom flat, asked for someone to come and fix it in August last year.
A series of quotes were rejected by the landlord without explanation, leaving Ms Anders in limbo for months. Finally the plumber came early in December and fixed the leak, but left a rotten part of the bathroom wall uninsulated and dismantled.
The letting agent was still unable to contact the landlord to arrange repairs, leaving Ms Anders with a cold and smelly bathroom in the winter.
The problem is that while Ms Anders has nowhere to turn but Foxtons, the agency is acting for the landlord. So while Foxtons charges certain fees to tenants such as Ms Anders, its main income comes from fees from landlords, which can be as much as 20pc of the rent.
In this case Foxtons said it could not act without express consent from the landlord. It also warned Ms Anders that she faced losing thousands of pounds if she moved out, as she would be breaking her contract.
Foxtons further incensed Ms Anders by informing her that a contractor who had visited her home had described it as “habitable”.
She paid hundreds of pounds in fees to rent the flat and another £90 in July when the tenancy was renewed.
“So many young professionals rent. Landlords and agencies are exploiting the fact that we don’t have any choice. At no point did they say the landlord was in breach of her contract – but on many occasions they told me I would be,” she said.
Eventually, Ms Anders found somewhere else to live, and moved out at the end of December, but was told by the agent that her contract would not allow her to leave without a penalty. She is still not sure whether she will get her £1,700 deposit back.
When contacted by Telegraph Money, a spokesman for the letting agency said it was “sympathetic and equally disappointed” and that this was an “isolated incident”.
“The tenancy agreement is between the landlord and the tenant. Therefore, the only person who has the legal power to release a tenant from the contract is the landlord,” he said.
“Likewise, the legal power to authorise repairs stands with the landlord, who in this case, has unfortunately not provided consent for all the repairs requested to date, or agreed to release the tenant from the tenancy agreement.
“Foxtons continues to work towards a satisfactory resolution of this case.”
Foxtons also gave us a copy of a letter sent to Ms Anders shortly before Christmas offering her £500 compensation and stating that the landlord would not allow her to move without forfeiting her deposit. The letter said: “We are obliged to follow the instructions of our client, the landlord.”
Dan Wilson-Craw, of the campaign group Generation Rent, said: “It’s not right that letting agents charge someone who isn’t their customer. Just in terms of basic fairness, it makes complete sense to make landlords pay for it,” he said.
Under current rules, letting agencies should also not charge tenants for the same things that landlords are charged for, or charge non-specific “administration fees”.
Under the Government’s proposals all charges would have to be met by landlords or the agencies.
http://www.telegraph.co.uk/property/renting/dont-abandon-letting-fees-ban-say-tenants/
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