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Problems with letting agents on the rise for young adults as fees go up

19 Medi 2016

The number of people aged 17-24 seeking help with problems with letting agents has more than doubled over the last two years, Citizens Advice reveals today.

University students moving into privately rented accommodation around the country this month could be among those stung by bad letting agents that charge hundreds of pounds but provide poor or minimal service.

Citizens Advice helped people with 6,500 problems with letting agencies between July 2015 and June 2016, a 14% rise from the 5,700 problems reported two years ago.

The biggest rise was among 17-24 year olds, who sought help with 810 problems with letting agents in the last year, compared to 360 cases reported between July 2013 and June 2014.

Previous research highlighted problems with letting agents’ ongoing management of properties, with delays in getting basic repairs completed or in fixing properties that were so damp or cold they could pose a health risk.

In other cases tenants sought help when they felt the fees they paid for administration were much more than the cost of renewing their tenancy agreement.

While there has been a rise in young people experiencing problems with letting agents, people in full-time employment are the most likely to experience these issues. More than one in three people seeking Citizens Advice’s help works more than 30 hours a week, new analysis shows.

Over a million couples with children now rent privately, making this the most common type of household in the sector. This leaves these families more at risk of paying for poor service from letting agents.

The price of letting agents’ fees have risen considerably in recent years, going up by as much as 60% over the last five years. Official figures from a survey of tenants suggests the average (median) letting agent fee has risen from £125 in 2009-10 to £200 in 2014-15.

But people could be paying much more - Citizens Advice’s research with letting agents has previously revealed fees as high as £337 on average, and up to £700 in some cases.

Letting agents charge fees for admin tasks such as preparing the tenancy agreement, checking references and credit checks. They may also require the tenant to pay a holding deposit after a prospective tenant has agreed to the rent but not yet signed the tenancy agreement. These fees are often non-refundable, and are charged on top of advertised rent prices and deposits for the property.

The national charity is calling for a ban on letting agents charging tenants fees. Currently both landlords and tenants are charged fees for the letting agents’ services.  Citizens Advice believes there should just be one charge which is paid for by landlords, who are in a better position to shop around and pick the best agency.

Gillian Guy, chief executive of Citizens Advice, said: “Letting agents are hiking up their fees for a service that’s often not up to scratch.

“With fees rising year on year for letting agents, many tenants will rightly be wondering why they are paying hundreds of pounds for a simple contract renewal or for management services that leave them waiting months for essential repairs. 

“It is concerning that younger renters are among the most likely to report problems with a letting agent, when many will end up using letting agents to find somewhere to live at university.

“Private renters shop around for properties, not for letting agents. Landlords are better able to choose agencies based on performance and cost and it should therefore be landlords paying letting agent fees, not tenants picking up these rising costs."

Notes to editors

  1. The English Housing Survey Private Rented Sector Report, 2014-15 (published July 2016) revealed that the median letting agent fee paid in 2014-15 was £200, compared to £125 in 2009-10.
  2. The Citizens Advice service comprises a network of local Citizens Advice, all of which are independent charities, the Citizens Advice consumer service and national charity Citizens Advice. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers. For more see the Citizens Advice website.
  3. The advice provided by the Citizens Advice service is free, independent, confidential and impartial, and available to everyone regardless of race, gender, disability, sexual orientation, religion, age or nationality.
  4. To get advice online or find your local Citizens Advice in England and Wales, visit citizensadvice.org.uk
  5. You can get consumer advice from the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 for Welsh language speakers.
  6. Local Citizens Advice in England and Wales advised 2.5 million clients on 6.2 million problems in 2014/15. For full service statistics see our publication Advice trends.
  7. Citizens Advice service staff are supported by more than 21,000 trained volunteers, working at over 2,500 service outlets across England and Wales.