A stand against estate agents?
November 15, 2012 8:21 PM   Subscribe

UK Estate Agents - worth taking a stand?

We're moving to a new, rented flat in London, and the estate agent (Hamptons) is insisting we pay an 'application to rent' ostensibly to enter into negotiations with the landlord (though everything has already been agreed), and it contains some shocking extra fees, all in addition to the contract fees, and the management fees they charge the landlord.

They require a £54 reference fee per tenant (they use Letsure, which costs £32.40), a £30 fee for any changes to the tenancy document, a minimum charge of £30 to get a reference from Hamptons at any time, £30 'admin' fee for any changes to the inventory document, £60 if you extend or renew the contract, £420 to change the name of a tenant on the contract, and most surprising of all if you terminate the tenancy early you, the tenant, are required to pay Hamptons the rest of the commission they would have been paid by the landlord.

Is this normal? Is it just us who think it is excessive? Is there anything we can do - on this occasion specifically, and to try and stop this kind of thing more generally? Hamptons is an international firm who seem to be pushing the boundaries of fleecing landlord and tenant, which, if they get away with it, is eventually is going to trickle through the market.

I've had a look at the trade associations but they seem toothless and the complaint procedure is arduous and for cases of specific malpractice. Estate Agents in general have a pretty poor reputation, and agent consumer review sites are few and seem to have little traffic, and also require reviews for specific branches rather than issue with the agency as a whole.

Should we just deal?
posted by Marzipan to Work & Money (9 answers total) 2 users marked this as a favorite
Some of the fees are normal, though the last one you mention is not one I've come across before. Usually you are obliged to pay the landlord if you terminate early. This is the most excessive I've heard of so far.

London is fleece central and they will push boundaries as much as they can because the market is a little nuts and as you say it unregulated. We were told we would not be able to amend the rental agreement (which we had previously not seen) which was offered to us which breaches the concept of "consideration". I asked a British friend who specialises in contract line and she summed this argument from the real estate agent up as "horseshit".

In our case the bottom line was we wanted the flat and we were already committed to moving at this point so though legally we were right, practically we were hamstrung. It depends on how deep you are into the transaction and if you afford to pull out at this stage.

In retrospect I would not commit to anything with an estate agent until I get everything laid out in writing. Honestly I think most you can do is not give them your business if their fees exceed the norm.
posted by BAKERSFIELD! at 11:08 PM on November 15, 2012

It's not normal for most of the country, but it's pretty standard for London. Letting agents are robbing money sponges, most of whom are useless and simply sit between you and the landlord soaking up cash from both directions.

Take LOTS of digital photos on your move in day, or they'll try and stiff you on the way out too.
posted by Happy Dave at 1:14 AM on November 16, 2012 [3 favorites]

Ultimately, if you want to rent the property, then you have to deal with the agent. The agent can, essentially, set whatever fees they like for their services - as ridiculous as they may be. The owner of course has the option of using a less over the top agent - but that's up to them. I've always gone with private lettings - no agents - purely to avoid this nonsense.

Read the contract, all of the small print, decide whether it's worth it - if you sign it then you've agreed to the fees.
posted by Hobo at 1:36 AM on November 16, 2012

It's on the high end of normal.

Having rented a number of places in London, I've encountered everything from paying just the rent and deposit to (as you have encountered) a number of fees being added on top. In addition, Hamptons is on the posher end of the real estate market. (To give you an idea, my partner and I are both well-paid professionals and once went into Hamptons to see what they had. They asked what price range we were looking at, we told them, and the agent demurred "We don't deal with the budget end of the market.")

My experience is that once you're in place and the contract is to be renewed, you have a lot more power. The agent doesn't want to lose a tenant in place. But on the initial contract, you're kinda screwed. You might be able to negotiate the get-out / early termination clause. But look at it this way, many of those fees will possibly never come up.
posted by outlier at 1:44 AM on November 16, 2012

Welcome to London. You'll also find the weather and food are exceptional.
posted by jannw at 4:28 AM on November 16, 2012 [4 favorites]

Hobo - how do you find private lettings? I'm going to be renting a flat for the first time next year after living in flatshares, and the excess fees really worry me.

There is legislation in place now in Scotland to prevent excess fees, so hopefully this will also come to the rest of the UK. Sadly, with more and more people being priced out of ever being able to buy somewhere, agencies are able to pretty much charge what they want it seems.
posted by mippy at 4:58 AM on November 16, 2012

I moved between rental places in London last year, after three years in the same property and was shocked by what had happened in the rental market. I was bracing myself for the jump in rent but the letting agents had gone completely nuts in the time I'd sat in my longer rental. Fees for everything (although you paying their remaining commission is beyond what I've heard of before) and money upfront just to open the negotiations. Truly nuts.

I agree that private landlords are the way to go if you can, we've always had really nice ones, but I think they are harder to find than they used to be. We found our place 6 years ago on gumtree but when I went on there last year it was all agents so no help at all.

Try asking around at work and with friends to see if anyone can hook you up. The agents will continue to squeeze you - for changes to the contract, for 'checking out' fee - the entire time. I'd even consider paying a bit more upfront to a private ladlord to avoid this nonsense.
posted by Dorothia at 8:54 AM on November 16, 2012

mippy: Websites like gumtree and spareroom allow landlords to list houses directly.
posted by Mike1024 at 2:02 PM on November 16, 2012

My friend tried Gumtree years ago for the same reason, and had two incidences of 'landlords' who had 'forgotten the keys' and told them it would still be fine to look around, they'd just force the lock open...
posted by mippy at 10:08 AM on November 17, 2012

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