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Since November 1st, 2013, landlords and letting agencies on the mainland, have had to legally disclose any non-optional fees charged such as the administrative fees. These fees tend to run into the hundreds of pounds, be non-refundable, and often are charged even if the prospective tenant is not accepted into the property.

England’s a Postcode Lottery for Admin Fees

Some agencies in London and the southeast of England have charged up to £600 in non-refundable fees while the highest overall average fee was in the southwest in Bristol, at £251 for one person wishing to rent a property. These fees can be broken down by major English cities into the following:

Birmingham - £164

Bristol - £251

Liverpool - £137

London - £220

Manchester - £160

Nottingham - £185

No Moral Case for Letting Agent Fees

These fees tend to not only be leveraged from potential tenants who have no other choice but to pay them and hope, but also costs for registrations are being taken out of rents paid to landlords as agents seek to maximize profits. They are able to get away with this due to lax regulation and also because high demand on a relatively small pool of properties means there’s always someone willing to pay in order to rent.

Letting agencies justify the totals by claiming this goes towards the cost of drafting tenancy agreements and credit checks. However, as an investigation by This Is Money in 2013 found out, this takes 90 minutes to do and if bought wholesale, a credit check can cost as little as 20p. It is truly scandalous that letting agencies are able to charge such huge fees for relatively inexpensive work.

What is the Lettings Law in Jersey?

Jersey Law states that a lease agreement must not include “an obligation for the tenant to pay a premium or key money.” Otherwise financials are limited to deposits or guarantees being clearly stated in the lease agreement and for this money to be deposited in the MyDeposits Jersey scheme as of 2nd November, 2015. It is quite clear that agents on the island at least should not be charging non-optional fees. Conversely, the New Jersey law across the pond, states that deposits and fees combined cannot total more than 1.5 month’s worth of rent. In England it’s up to 1.5 months for the deposit with fees on top which can total over 2 months rent in total up front. No matter the solution, it’s clear the best for happy tenants is a no fee basis or at least something refundable.

Letting Agents Should be Taking a Moral Stand on This

It’s one thing for our elected officials to dictate rules - there must be a minimum standard for any business or adhere to, but as service providers we should never be comfortable with just keeping to a minimum standard. Lettings agencies have a poor reputation, but they are not the only option out there and many rental accommodation providers are now improving standards, both in terms of what they expect landlords to provide tenants, but how they service tenants too.

High quality Accommodation Providers instead accept that finding and retaining good tenants is something every company in the industry should aim for. Quick turnovers and profiteering from fees is not only amoral, but short-termist too. The key to a sustainable landlord business is long-term, decent tenants who trust their provider and who are in turn trusted to make a place home. This is why we do not charge admin fees for something which costs very little in the first place.

What Can Tenants Do?

Tenants should remember that this is a market and not a controlled sector, which means that different firms are competing against each other for customers. There are more estate agents, letting agents, and accommodation providers than there are supermarkets to choose from. They do not all charge the same fees and as we’ve seen, some of us do not charge any at all. Businesses thrive where the business is, so vote with your feet and rent with those who do not charge fees or who charge the lowest. Market demand will bring the others down in time or they will lose their business altogether.

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