Thursday, 02 April 2015 00:00

Letting agency fees cost tenants £337 – Citizens Advice

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 Citizens Advice report finds letting agencies’ charges vary between £6 and £300 to check a reference. Photograph: Christopher Furlong/Getty Images Citizens Advice report finds letting agencies’ charges vary between £6 and £300 to check a reference. Photograph: Christopher Furlong/Getty Images

Charity’s report slams ‘rip-off’ agencies and says transparency alone won’t solve the problem

Rip-off letting agency fees are costing Britain’s growing number of private sector tenants an average of £337 each and should be banned, according to a report from Citizens Advice.

The advice charity said the charges come on top of advertised rents and deposits, and in some cases can throw people into debt.

A ban on fees was introduced in Scotland in 2012, and Citizens Advice said there was no clear evidence to suggest it had led to an increase in rental prices.

Its report, Still Let Down, argues that limited measures introduced in England to protect tenants have largely failed. “Letting agents have refused to adopt measures that were supposed to bring transparency and competition to the market,” it said.

Letting agency fees range enormously across the country and between agents. Citizens Advice found that costs for checking references range from £6 to £300.

Renters can also be hit by charges of between £15 and £300 for simply renewing their tenancies. Some agents charged £300 for credit checks that are widely available for £25, it found.

When moving out of a property, almost half of the 353 agencies polled by Citizens Advice said they charged an average “check out” fee of £76.

Gillian Guy, chief executive of Citizens Advice, said she was not calling for a fees ban lightly. “Our research confirms renters don’t shop around for letting agents, they shop around for properties – so the idea that transparent fees will solve these problems is misguided,” she said.

“Landlords can hold agencies to account so it is right that they should shoulder the responsibility of fees. That would end once and for all the situation in which letting agents charge tenants what they like.”

The number of people renting privately has soared since the start of the buy-to-let boom, with home ownership levels plummeting. More than 4.5m homes are now privately let, and the figures is expected to above 6m by 2019, or around a quarter of all homes, according to research by estate agency Savills.

Citizens Advice said it is dealing with growing numbers of tenants seeking help, with more than 80,000 people coming to the charity suffering with a problem with a privately rented home in 2014. Common issues included illegal eviction and harassment, lost deposits and struggles to secure the most basic repairs.

Recently the Communities and Local Government Committee said the evidence from the existing ban in Scotland is not strong enough to reach a view on the impact of a possible ban in England.

Bodies in Scotland appeared to be divided on whether any change in rent levels could be directly linked to the ban, the committee said.

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