Letting Agent Fees Will Discourage Landlords From Using Service

30 per cent of landlords may be discouraged from using the service of a letting agent or third party if landlord fees were to rise following a ban on tenant fees.

New research from Paragon in the lender’s latest Private Rented Sector Trends report found that 73 per cent of landlords currently use a letting agent or third party to rent some or all of their properties. Of these, a sizeable 12 per cent said that they would be less likely to do so if landlord fees increased as a result of tenant fees being abolished. 18 per cent said that they would ‘probably’ stop using these services.

However, the majority of landlords who currently use an agent’s service would not be discouraged from doing so, even with a rise in fees. 16 per cent would definitely continue using a letting agent, and 30 per cent would probably continue.

27 per cent of landlords do not use the services of an agent or third party to let any of their properties. Of these, 84 per cent do not charge any tenant fees whilst 16 per cent do. The most common fees charged by landlords without an agent’s involvement are for a credit check, with 60 per cent charging for this. 55 per cent charge for an inventory, 42 per cent for a tenancy agreement and 33 per cent for other, unspecified fees.

Managing director of mortgages at Paragon, John Heron, said: ‘In the midst of ongoing turbulence in the Private Rented Sector, landlords have already had to navigate through challenging policy changes, and rethink their strategies accordingly. An increase in landlord costs as a result of a ban on tenant fees would be the latest in a succession of challenges and it’s unsurprising to learn that a substantial number of landlords might consider altering their approach to letting out their properties in that circumstance.

https://residentiallandlord.com/letting-agent-fees-will-discourage-landlords-using-service/