Letting agents who behave badly and charge rip-off fees should face tougher sanctions which would see them put out of business, according to a committee of MPs.
The Communities and Local Government committee said letting agents should have to meet the same standards as estate agents and the Office of Fair Trading (OFT) should have the power to ban those who indulge in ‘sharp practice’.
Which? executive director Richard Lloyd said: ‘We’ve been calling for letting agents to come under the same regulations as estate agents since we uncovered an alarming lack of consumer protection and widescale poor practice in this market.
‘We hope the government puts these plans into action as soon as possible. We also want the OFT to crackdown on hidden charges so that people know what they are signing up to and can more easily shop around.’
If you feel you’ve been short-changed by a letting agent you can follow our step-by-step guide to complain.
Upfront letting agent fees
The Private Rented Sector report added that there should be an upfront cost breakdown of fees clearly displayed on property websites and in letting agents’ windows to help put an end to hidden and ‘opaque’ charges.
The government should also come up with a standard ‘plain language’ tenancy agreement, including an easy-to-read factsheet setting out landlords’ and tenants’ rights and responsibilities, the report said.
The report comes after a ruling in March by the Advertising Standards Authority (ASA) that letting agents should include all compulsory fees and charges in property adverts
Which? investigates letting agents
Earlier this year a snapshot mystery shopping exercise by Which? highlighted that letting agents often fail to disclose fees upfront and are unable to provide information on fees in writing.
Mystery shoppers posing as potential tenants visited branches of Foxtons, Barnard Marcus, Martin & Co and Your Move across London. In only one instance did a letting Agent (Foxtons) disclose fee information during a branch visit without being asked.
On several occasions staff were unable to provide accurate fee information and none of the agents displayed information about fees on their websites or in online property listings.
Our research found that the average cost for mandatory administration and referencing fees across all agents was £310, and the highest was £420. Some tenants could also face check-in and check-out fees, bringing the total closer to £600.