Arranging a tenancy takes time and time, as we all know, inevitably equals money. You have to expect to be hit with some fees when you take up a tenancy on a property, but any respectable letting agent will provide you with clear information about its charges before you sign anything.
As a respected and long-established agency New Life Lettings make sure all their fees are clear and up-front, but here is a short guide to what you can reasonably expect with all letting agencies, and one or two things you shouldn’t have to pay for.
Firstly - no letting agent is allowed to charge you for registering with them, or showing you its list of properties available for renting. It is a criminal offence for an agency to make these charges, so don’t pay them! If you find anyone asking for these fees report them to your local trading standards office straight away.
They should not charge you for routine inspections during your tenancy either; make sure it’s in writing that this is the case. It’s easy money for unscrupulous agents otherwise.
Fees you can reasonably be expected to pay cover things like:
drawing up tenancy agreements and an inventory of the property
carrying out credit checks
getting references from your employer, bank and/or previous landlord
administrative costs such as phone calls and postage
renewing the tenancy agreement when the fixed term ends
‘check out’ fees – inspections of the property when you move out
If you are asked for fees above and beyond these then it’s time to start questioning them; for example, when first moving in the cost of cleaning up the property after the previous tenants shouldn’t fall on you, so any charges like that should be queried carefully.
In fact from 1 November 2013, all letting agencies inEnglandmust disclose upfront any fees they charge in their adverts and listings, although property websites like Rightmove and Zoopla are exempt from this requirement.
One other cost to consider (which is not a fee but should be kept in mind when budgeting) is the holding deposit.
Some letting agents ask prospective tenants to pay a holding deposit to 'reserve' a particular property while references are checked and the tenancy agreement is drawn up. When you pay a holding deposit you are guaranteeing that you will take up the tenancy, and the landlord or agent is guaranteeing to let it to you.
Ask the letting agent for written confirmation that the holding deposit will either be returned once you move in, or that it will be used as part of your tenancy deposit.
Do not pay a holding deposit unless you have decided to take the property. If you decide not to move in, the holding deposit will probably not be returned to you. However, if the landlord doesn’t go ahead with the tenancy, you have the right to get your holding deposit back.
You will always be asked to pay a significant sum as a deposit when you first let a property, usually at least one month’s rent. This is kept in the bank and returned to you when you move out providing the property is in good condition and you haven’t sold the landlord’s carpets on Ebay!
Your deposit should be kept safe in a government-backed tenancy deposit protection scheme until your tenancy ends. Within 30 days of you moving in and paying your deposit to the letting agent, you should be given details of which scheme your money has been paid into.