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kaladorm

Moving In: How Much Is Too Much?

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I'd like urgent replies if possible as, of course, "there is a lot of interest in the house at the moment" (think I know a used car sales trick when I see one hehe)

I have a very simple question I wanted to put out to the community as I'm looking at moving into a new place with my girlfriend shortly. Simply:

How much of an admin fee is too much?

I've been given the following quote for moving in:

Tenancy set up fee - £435.95

Holding deposit - £300.00

Total - £735.95

Deposit - £1275.00

First month’s rent - £850.00

Check in - £138.00

Total – £2263.00

Less Holding - £300.00

Total - £1963.00

That makes the total payable (on a rent of £850/month) - 2698.95. Over triple a months rent.

We've negotiated with them on the admin fee as that part seems excessive, they've agreed to knock it down from 435.95 to 360, however it still seems to much to me. Included with the check in fee as well it's well over 50% of a months rent that we won't be seeing again.

So, any thoughts? Is this normal nowadays or should we steer clear of this agency?

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Sorry, I have no idea. And just posting to comiserate doesn't help, I know ... but *how* much for contract set up and how much for handover of a set of keys ....!??!?!?!?!

Truly shocking IMHO.

Aidanapword

Edited by Aidan Ap Word

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What area of the country are you in? As a comparison here in Newcastle city centre the last time I moved the admin fee was £300 with the usual month's rent up from and 6 weeks rent as a deposit.

In short I think your lot are taking the p*ss. Most letting agents use credit reference agencies to get a rating for you at about £40 and other than that they might need to call your current landlord and employer and change one name on the contract. About an hour's work tops!

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I'd like urgent replies if possible as, of course, "there is a lot of interest in the house at the moment" (think I know a used car sales trick when I see one hehe)

I have a very simple question I wanted to put out to the community as I'm looking at moving into a new place with my girlfriend shortly. Simply:

How much of an admin fee is too much?

I've been given the following quote for moving in:

That makes the total payable (on a rent of £850/month) - 2698.95. Over triple a months rent.

We've negotiated with them on the admin fee as that part seems excessive, they've agreed to knock it down from 435.95 to 360, however it still seems to much to me. Included with the check in fee as well it's well over 50% of a months rent that we won't be seeing again.

So, any thoughts? Is this normal nowadays or should we steer clear of this agency?

Six weeks rent as a deposit is normal.

Fees - additional £200 for all the checks and references (for a couple)

Anything more than this, question it.

Walk away if necessary.

Based only on my experience.

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Thanks guys, I figured 6 weeks deposit was about right, the real bit that had me raising a question mark was the fees and then additional check-in. Seems to me like the agency are passing on stuff I would expect the landlord to be paying

Just to give you an idea on the area this is in Reading central.

(Also on an unrelated note, I read that I have to provide contents insurance for my landlords posessions. This was the same as my last rental but still the concept of it doesn't feel right to me :) Ahhh renting may suck but buyings no better. Travelling folk seem to have the right idea...)

Edited by kaladorm

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You are being asked to pay the better part of £600 for moving in by the agent (putting rent and deposits to one side, which are standard.)

This is outrageous, as their actual costs for 2 credit and reference checks will be under £20 for the pair (there are companies that specialise in doing this for very little) and the cost of printing out a standard contract - say 50p including paper and ink.

I'd laugh and walk away. The most I have paid was £260 in the South East (Oxfordshire) and that was being gouged to the extreme in my opinion. Also check the proposed contract for checking out fees and contract renewal fees as these scum will not miss a trick. Private landlords generally do this stuff for free, and most agents I have used charged on the order of £130 or less.

I presume you have already paid them some money, in which case it may not be cost effective to back out now, but you have been ripped off.

Edited by Tiger Woods?

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I've not paid them anything yet. To the disappointment of my GF I don't think I will be paying them anything either.

I have a healthy degree of cynicism to agents (and perhaps landlords in general), particularly now if you read my other thread ;). Having said that the tenancy contract was unavailable before we handed over the holding fee (alarm bell 1), a tenancy agreement was sent over however the bits to sign are different to the bits in the small print below: notably that the signed agreement says contents insurance is 'required' but the small print says advisable, also it says the deposit will be paid into a separate bank account and not into a TDS (major alarm bell 2).

It may just be an out of date contract, and sadly I know that if I back away from it some other poor mug will get stuck with them, but at the very least I can protect myself and make a stand against crappy agents :)

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I've been paying a maximum of £100 for the checkin fee. For setting up the actual tenancy the agencies I have spoken to break it down into credit checks (per person) and then a fee for preparing the lease.

In the past I've been able to negotiate the deposit down to one month only, but 6 or even 8 weeks is the starting point.

The "holding deposit" part I always find annoying. This is to try and trap the tenant into waiting for the lease to be down up and everything agreed. However, there is no similar charge that the LL has to pay. They are free to walk away at any time.

Edited by Flopsy

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OP - I'm in Reading too. Paid about £1800 in deposit and fees to move into our place in September 2009 (£750 pcm).

Before you go for the plunge be sure to:

a) Not rent with Romans. Those guys have a horrific reputation for stealing deposits ("The place was dirty and cost a total of £400 to clean up")

B) Read up about the prospective letting agency on http://www.allagents.co.uk/

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OP - I'm in Reading too. Paid about £1800 in deposit and fees to move into our place in September 2009 (£750 pcm).

Before you go for the plunge be sure to:

a) Not rent with Romans. Those guys have a horrific reputation for stealing deposits ("The place was dirty and cost a total of £400 to clean up")

B) Read up about the prospective letting agency on http://www.allagents.co.uk/

Oh I know Romans very well, having rented another place through them in Basingstoke (see my other thread on our deposit not being stored in a TDS) :).

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I've not paid them anything yet. To the disappointment of my GF I don't think I will be paying them anything either.

I have a healthy degree of cynicism to agents (and perhaps landlords in general), particularly now if you read my other thread ;). Having said that the tenancy contract was unavailable before we handed over the holding fee (alarm bell 1), a tenancy agreement was sent over however the bits to sign are different to the bits in the small print below: notably that the signed agreement says contents insurance is 'required' but the small print says advisable, also it says the deposit will be paid into a separate bank account and not into a TDS (major alarm bell 2).

It may just be an out of date contract, and sadly I know that if I back away from it some other poor mug will get stuck with them, but at the very least I can protect myself and make a stand against crappy agents :)

When we moved into our place in York (not a great place) the rent was £595 and deposit £895 which is about right I think, £50 each for credit references (which piss me off as there is no onus on the landlord to do the same for you and only cost a tenner), no check in fee and we paid a holding deposit of £200 because it was the first place we'd looked at and liked (although paid without seeing the contract-obviously)

point 1-would you not be at risk of insurance fraud if you were insuring items for a payout that aren't yours, surely it'd need to be some sort of deposit insurance for damages-pretty sure that requiring you to insure anothers property would be an unfair term in a consumer contract though anyway so could be kicked into touch.

point 2-Sure you already know but them not putting the deposit in the tds would be a windfall for you when you take them to court at the end of the tenancy.

Edit-I seem to have gone dyslexic

Edited by zebbedee

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Most of our landlords require a bond equal to 1 month's rent or sometimes an additional £100.

Our admin fees are £175.

You would also need to pay the first rent in advance.

If the rent was £850, then you would need £1,875 with us.

However, different regions do things differently. Some agents charge much more depending on the area they are located.

I would try to negotiate the rent and the fees. You don't get if you don't ask. You also have more chance of negotiating rent if the property is managed by the agent has they will want to get the management fee ASAP. If there are more than one agent marketing the property, then they will negotiate the fee more often than not to beat other agents to the deal.

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Ive only ever paid 100 to 150 pounds for the letting agency scum to load up their standard agreement and change the address and names before printing it out. And that's obviously a ridiculous amount. A holding fee has always been returned, it's always been a figure of 100 or so just to show you're serious about taking the property on. A months rent for the deposit is the norm. This is already outrageous when you consider they charge the landlord for 'drawing up the contract' (changing a few lines of text and printing it out) as well as you, anything else of the type that has been mentioned in this thread is utterly, utterly ridiculous and i'd be hard pressed not to put the letting agents window in for daring to suggest it.

Walk away.

Edited by cybernoid

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Ive only ever paid 100 to 150 pounds for the letting agency scum to load up their standard agreement and change the address and names before printing it out. And that's obviously a ridiculous amount. A holding fee has always been returned, it's always been a figure of 100 or so just to show you're serious about taking the property on. A months rent for the deposit is the norm. This is already outrageous when you consider they charge the landlord for 'drawing up the contract' (changing a few lines of text and printing it out) as well as you, anything else of the type that has been mentioned in this thread is utterly, utterly ridiculous and i'd be hard pressed not to put the letting agents window in for daring to suggest it.

Walk away.

I understand your point about the fees, but there is a lot more to it than what you say.

The tenancy agreements are just like you say though. A template that gets edited and printed.

However, the tenant fee covers various things. Firstly the credit and referencing. We sub contract this out and it costs us £25 unless a guarantor is needed, then it's double. Obviuosly we charge a little for ink and paper, but the majority of the fee covers our time spent. We charge £60 per hour and I assume others charge much more. The time spent is on many things including editing of the tenancy, witnessing the signatures, checking the tenant in to the property and going through the inventory plus dealing with all the extra few calls required to make sure everybody is happy. You may think that none of this takes up time, but I can assure you it does and of course we have to make money or we would not be in business.

The fee charged to the landlord is for marketing the property and finding a tenant. This is where most of our time is spent with arranging viewings and carrying them out. Then of course the time and money spent on advertising.

The main point I am trying to get at is we do a lot more work than most people give us credit for. Well we do if it's done correctly.

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Good to have an agent in the thread to give a view from the other side ;). As I mentioned before the agency seemed very pushy about trying to get us in and sign and hand over cash asap - the property is entirely agency managed as well so I wouldn't be surprised if they were passing on the LL fees to us with such a high amount.

For future reference for anyone else in the Reading area we found another central location flat with another agency and the total 'fees' was around £210 which is much more reasonable.

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However, the tenant fee covers various things. Firstly the credit and referencing.

Does that really tell you anything? Obviously when I returned to the UK after six years abroad I had no credit record, yet I managed to rent somewhere.

Now that I have no job but could demonstrate a six-figure sum in savings by just logging on to a couple of accounts, what checks would you expect to run? Kind-of wondering if I'm in the bizarre position where I'd find it harder to (qualify to) rent than to buy outright.

Oh, and what about credit checks on the landlord: do you do those, or would you yourself offer insurance-backed indemnity against any losses due to a rogue landlord getting repossessed from under a tenant?

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Where we are, it seems typical to ask for a month's rent + £100 as deposit, not 6 weeks rent or more. And as far as I know fees are typically what you pay up-front to sign up. No check-in/out plus other dubious things. Last year the agent only required that I be referenced at about £120 but this year, a different agent requires checks on the both of us even though only I can pay the rent. Pushes things up to £200 which I consider to be on the pricey side but the rent is such a good deal, I can't really complain too much.

I'd agree with SPA about re-couping the costs of advertising, referencing and driving round doing viewings (we've done 6 and had a load more planned if we hadn't taken a house so 5 "wasted" viewings. What's the industry standard for hits and misses? 10 to 1? 20 to 1? More?) but what gets my goat is when agents try to drop in spurious charges during a tenancy. Even if you do want to extend a contract for a fixed time, I can't see why the cost of speaking to the tenant, the landlord and drawing up another template contract isn't absorbed by the 'cut' the agent takes every month without needing a £50+VAT charge. We've needed nothing over the last 12 months and the agent has earned their money for being 'on-call' but hasn't actually done much for £1000 in fees (assuming 10%). You do the math if a normal %-age is higher.

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I'd agree with SPA about re-couping the costs of advertising, referencing and driving round doing viewings (we've done 6 and had a load more planned if we hadn't taken a house so 5 "wasted" viewings. What's the industry standard for hits and misses? 10 to 1? 20 to 1? More?) but what gets my goat is when agents try to drop in spurious charges during a tenancy. Even if you do want to extend a contract for a fixed time, I can't see why the cost of speaking to the tenant, the landlord and drawing up another template contract isn't absorbed by the 'cut' the agent takes every month without needing a £50+VAT charge. We've needed nothing over the last 12 months and the agent has earned their money for being 'on-call' but hasn't actually done much for £1000 in fees (assuming 10%). You do the math if a normal %-age is higher.

No need for the extra's that many agents add in.

If we do a renewal, then we make sure both tenant and landlord want the renewal and tell them our charge which is £60. They only need this for security of the tenancy which is good for both. For the time it takes we try to get everybody to do 12 month renewals when possible.

With regards to number of viewings. Hard to say really. Usually depends on the property and how well you qualify the tenants. We try to give more information including any negatives before arranging a viewing. This generally saves us doing more than we need to. If the property is up to a good standard, then it will let on one viewing. If it's not very good, then we could possibly do 20 viewings.

When we qualify tenants we usually only need to show them on average 2 properties which are usually done at the same time.

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Does that really tell you anything? Obviously when I returned to the UK after six years abroad I had no credit record, yet I managed to rent somewhere.

Now that I have no job but could demonstrate a six-figure sum in savings by just logging on to a couple of accounts, what checks would you expect to run? Kind-of wondering if I'm in the bizarre position where I'd find it harder to (qualify to) rent than to buy outright.

Oh, and what about credit checks on the landlord: do you do those, or would you yourself offer insurance-backed indemnity against any losses due to a rogue landlord getting repossessed from under a tenant?

When you returned from overseas you should really have needed a guarantor unless your earnings were more than acceptable for the rent. Due to having no credit and I assume no previous landlord references, then it would have been a case of a decision to be made by the agent. In these cases we usually get a response from the referencing agency stating the details of everything and told to make a decision ourselves. We would explain to the landlord and let them make the choice, so that they are fully aware.

Your position now id quite different. Savings unfortunately count for nothing with the referencing agencies. You would need a guarantor whom would also be referenced.

Good point about the landlords. We check everything we are required to do by law and have no control over what they do with regards to paying mortgages etc.

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The main point I am trying to get at is we do a lot more work than most people give us credit for. Well we do if it's done correctly.

I wouldn't call that 'a lot more', but I take your point. And obviously as a business you're interested in charging as much as you can get away with and minimising your expenditure. What gets most peoples backs up is the ethical side, you've got people who typically don't have much money over a barrel and high fees for typically poor service feels like exploitation to most. Those crafty 100/200 quid charges here and there might seem very clever to you but this income from tenants is from the taxed take home pay of individuals who are just trying to get by. It's worth bearing that in mind.

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i'm not looking forward to finding out about all these extra fees. i'm looking to rent in a couple of months, and my credit histroy is well "chequred" but i have a stable (as it can be, considering) job that i have been in for a long time, so hopefully all will be well.

i've heard of some LA's asking for people to pay for a credit check BEFORE any viewings to prove your not going to waste their time. i understand this, but if i dont like their properties, etc then its a waste of money, and if all LA's did this, it would cost a fortune for me to view any prostective property

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Good to have an agent in the thread to give a view from the other side ;). As I mentioned before the agency seemed very pushy about trying to get us in and sign and hand over cash asap - the property is entirely agency managed as well so I wouldn't be surprised if they were passing on the LL fees to us with such a high amount.

For future reference for anyone else in the Reading area we found another central location flat with another agency and the total 'fees' was around £210 which is much more reasonable.

What LA did you go through in the end mate?

We're looking at moving at the mo and have actually found one or two suitable places on gumtree, going directly through the EA.

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i'm not looking forward to finding out about all these extra fees. i'm looking to rent in a couple of months, and my credit histroy is well "chequred" but i have a stable (as it can be, considering) job that i have been in for a long time, so hopefully all will be well.

i've heard of some LA's asking for people to pay for a credit check BEFORE any viewings to prove your not going to waste their time. i understand this, but if i dont like their properties, etc then its a waste of money, and if all LA's did this, it would cost a fortune for me to view any prostective property

This is something that I have never heard of before, but I would not be surprised with some LA's. If this is the case, then I assume they do this to make sure you let a property through them. I would only register with the LA if they have a couple of properties of interest and that you are likely to take a property with them. We charge nothing until a tenant wants to proceed and take the property off the market.

Would you not be able to take out a credit report of your own and show them the results?

I believe you can get a free 30 day trial with on-line credit reporting sites, so that you can supply them with one on the day which is right up to date.

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I wouldn't call that 'a lot more', but I take your point. And obviously as a business you're interested in charging as much as you can get away with and minimising your expenditure. What gets most peoples backs up is the ethical side, you've got people who typically don't have much money over a barrel and high fees for typically poor service feels like exploitation to most. Those crafty 100/200 quid charges here and there might seem very clever to you but this income from tenants is from the taxed take home pay of individuals who are just trying to get by. It's worth bearing that in mind.

As a business we charge what we can in-line with all other local agents providing it covers the charges that we incur, but like every fee that we advertise there is always a chance that we can negotiate.

I am a tenant myself and face these charges too through another agent.

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