Campaign to stop ‘unfair’ letting agent renewal fees is launched

A property-tech lettings company says high street letting agents are charging landlords up to £1bn a year in unfair renewal fees and has launched a campaign to stop them.

Hello Neighbour claims that landlords renting property through a letting agent are wasting money every time their tenant renews their contract, without getting any additional service or value.

The firm says there are more than one million rental properties in London and about 760,000 of them are using agents.

With the average tenant staying for two years, landlords are paying renewal fees on 380,000 properties each year, the firm has calculated.

‘High street agents have taken advantage of landlords’

The firm’s chairman, Phil Shelley, said: “For too long, high street agents have taken advantage of landlords by charging fees for things that just aren’t fair – especially renewal fees.

“It’s crazy to think that landlords are handing over this kind of money every time their tenants simply choose to stay in their home for another year.

“Punishing landlords for having a great property that people want to remain in is just absurd.”

He adds: “Inevitably, these renewal fees get passed onto tenants through increased rents which many landlords need to do to make it viable for them.

“So, in reality, both the landlords and tenants are the ones who suffer, while the letting agents’ revenues continue to soar.”

“We are determined to put a stop to this and that’s why today we are launching our “Stop Renewals Fee” campaign to educate landlords and let them know there is a better way so we can change lettings for good.”

Landlords are handing over £2,550 to agents

The firm says that the average renewal fee is around 8.5% (incl. VAT), which means that for an average London rent of £2,500 a month, landlords are handing over an extra £2,550 to agents.

This cost increases if the tenant stays for longer than two years.

Hello Neighbour also accuses high street letting agents of encouraging longer tenancy agreements at the outset to charge higher letting fees upfront, while still adding extra fees for contracts, references, inventory, deposits and safety certificates.

To combat these unfair fees, Hello Neighbour has launched its ‘Stop Renewal Fees’ campaign to educate the market and equip landlords with the questions they should ask their agents before signing up.

It is urging landlords across the UK to join the campaign and pledge their support to stop renewal fees for good.

The firm covers London and Greater London, Brighton, Oxford, Guildford and Reading and in January will unveil a ‘self-service offering’ for the whole of the UK.

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