Shelter’s campaign has come under fierce attack from the Residential Landlords Association.
Although the campaign is aimed at letting agents, RLA chairman Alan Ward said it was anti-landlord because of the proposal that landlords should bear all the costs of setting up a tenancy.
He said: “Once again we have Shelter peddling the same anti-landlord rhetoric, seeking to place yet more costs on the shoulders of landlords.
“With almost 90% of landlords being either individuals or couples renting out just a few properties, Shelter seems to think that landlords have a bottomless pit of money to spend.
“A similar scheme in Scotland has put many letting agents out of business, thereby reducing choice for tenants and landlords.
“Shelter’s campaign to impose on landlords excessive and unneeded red tape and costs will only serve to drive up rents for the very same tenants they try to serve.”
One landlord said he estimates landlords are already paying agents at least £1.7bn a year.
Jonathan Monjack is a media lawyer who formed a landlords’ collective called the Happy Tenant Company, and which operates a £500m portfolio in Greater London on the principle of group buying power. The company uses a panel of letting agents.
He said: “So many landlords – particularly those who aren’t professional property investors – get ripped off by letting agents who not only charge huge commissions for finding a tenant but also huge renewal fees simply for keeping the tenant in the property.
“The £1.7bn figure relates only to the amount that landlords are paying to secure and keep a tenant. In actual fact, they often end up paying significantly more to agents via management fees, ambiguous and ubiquitous administration fees and hefty mark-ups on any maintenance works that need doing. Agents often earn yet more revenue via fees charged to tenants and backhanders from contractors.
“Many landlords who don’t want the hassle of finding a tenant and managing their buy-to-let property themselves think agents are a necessary evil, but they don’t have to be.
“We believe in fairness and transparency. Under our group buying model, landlords get letting rates as low as 4% with no renewal fees and we offer flat fees for management with no mark-ups or admin fees.”
Article courtesy of Landlord Today