Shelter attacking the Lettings industry.

Shelter attacking the Lettings industry.

“Shelter”, the charity for the homeless is being very vocal in attacking Letting Agents, and in particular the fees they charge to tenants when they apply for properties.


Current claims in the industry that one in five people will be tenants within the next two years, means that a debate on high fees will resonate with many who find themselves in position where they need to rent their next home.


“Shelter” are actively pursuing quite a negative agenda in an attempt to ban application fees completely, and justify this by quoting “1 in 4 people who have dealt with a letting agency in the last three years said they had to borrow money to pay for fees.1 in 6 reported cutting down on food or heating to meet the cost of fees and 1 in 4 say that letting fees have stopped them from getting a new home”.


The argument is that the Landlord should pay all the costs involved and “they do not believe that rents will necessarily rise if upfront fees are banned. We believe that some in the lettings market charge high fees which do not reflect the work done, simply because they can.”


As a professional ARLA Letting agent with a High Street location in Hinckley, I’m in a position where I can attempt to counter argue against “Shelter”, and contrary to belief, most agents do provide a valuable service for Tenants and Landlords.  


The crux of the problem is that the Private Rental Sector (PRS) is serviced by businesses, and when an application is made by a tenant there are costs involved.  We are providing a service and should quite rightly charge reasonable fees for it. There isn’t a “fairy godmother” in the background donating money to our “cause”; and we have overheads such as staff to pay, utility bills, and further premises and equipment costs.  

Shelter firmly believes that Tenants are being systematically ripped off by agents and fees are excessive, but this is the PRS - Tenants have a choice. They do not have to apply for the property and if the agent is a professional one, Tenants can complain to the Property Ombudsman if they believe that they have been treated unfairly. If the Tenant is struggling to afford it then there are avenues where they can receive financial assistance, such as the local council, however the question has to be asked. If tenants are struggling to pay an application fee, what are they going to be like paying the rent?


So what does a “Professional Letting agent” actually mean? What is the difference between each shop on the High Street or online? They all have good branding, look professional and rent houses, surely they are all the same? Unfortunately, as in every business sector, there can easily be a rogue element and because the lettings industry isn’t regulated, other than being monitored by trading standards, regulating agents is a voluntary choice for businesses.  Spotting a professional is easy however. Look for the logo’s ARLA, UKARLA, NALS, RICS and the Property Ombudsman. Membership of the ombudsman means that there is a system of redress if a complaint is made.


At Martin & Co in Hinckley, my business is registered with ARLA and we’re scrutinised on a regular basis. I have to abide by brand standards because Martin & Co is a franchise; membership of ARLA requires passing a qualification and the client and deposit accounts are subsequently audited annually. We have to comply by a code of conduct and have a complaints procedure; we’re also members of the Property Ombudsman so there is redress. We charge fair fees, act in a professional manner, provide a quality service and have an excellent reputation because I do not believe in cutting corners. This costs money.


“Shelter” has been successful in Scotland where Tenant fees have been abolished, and are campaigning and encouraging people to sue agents for the repayment of previous fees. Although well intended, Shelters crusade against the industry is dangerous for any small business owner and could very well end with rents rising and good Letting business’s closing down.