Letting agents charge an average administration fee of £220 to secure a rental property in London, the equivalent cost of nearly 10 weeks of food shopping for the average person.
Nearly 25% of the London letting agents surveyed charge over £300 in administration fees, with the most expensive agent charging £600 in East Ham – more than half a year’s worth of food shopping.
Unsurprisingly, the most expensive letting agents were all found in London. Bristol was the only city with a higher average fee of £251.
George Spencer, CEO of Rentify, said: “As if it wasn’t bad enough that letting agents charge these unnecessary administration fees to tenants, some of these charges are also passed onto the landlord so the agent makes double the profit.
“These fees lack transparency and are simply unfair. Sometimes they cause tenants to pull out of properties because they have not been disclosed upfront, or budgeted for.
“The Advertising Standards Authority has ruled that from next month these costs must be clearly displayed in adverts alongside rental prices but there is no onus on agents to make their charges fairer, or better still, remove these unnecessary fees completely.
“These figures are especially interesting in the light of Communities Secretary Eric Pickles’ recent promise to cut down on rogue agents through compulsory redress schemes. Perhaps Mr. Pickles could have gone further by seeking to introduce new regulations, such as a qualification scheme for agents. At the very least, Rentify’s research lends strong support to the view that urgent action is required.”
Spencer added: “Rentify is committed to saving landlords and tenants money. Our research exposes the need for greater transparency in the rental market. We charge a flat £15 fee for a thorough credit check with no other ‘hidden’ extras. It can be done.”