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Letting agent 'demanding money to view properties'

https://www.bbc.co.uk/news/business-46111015

A letting agency has been demanding hundreds of pounds in payment before prospective tenants are allowed to view properties for rent, the BBC's Victoria Derbyshire programme has found.

The practice, by Flintons, breaches guidelines and could be unlawful.

Shadow housing minister Melanie Onn said renters needed more rights and the case was the "tip of the iceberg".

Flintons, in London, denied any wrongdoing and said it did not charge any fees for viewings.

Guidance from the Competition and Markets Authority says that to "require a deposit from a tenant before they have been given the opportunity to inspect the property or the tenancy agreement" could constitute an "aggressive practice" and be unlawful.

Several of Flintons's clients told the Victoria Derbyshire programme they had been assured by their estate agent that they would have their payment refunded if they did not like the property but after requesting refunds had been told the money was not refundable after all.

Israel Kujore and his friend Harry responded to one of Flintons's adverts.

He said they had gone to see an agent who had told them they needed to pay a deposit to see a room but that the money would be refundable.

They had paid £300 each to see a property, but Israel soon realised something was wrong.

Mr Kujore had then looked into the company online and found dozens of negative reviews.

"I was seeing reviews and horror stories. I was feeling really miserable and defeated. I was really upset," he said.

He had decided to seek a refund but had been told that the money was not refundable.

"£300 is half my rent gone. What can I do? I don't have the money to sue them. I don't have legal expertise to deal with it - I'm powerless."

Flintons said it issued receipts specifying the sums involved were non-refundable.

While this is true, Mr Kujore - and other tenants with similar experiences - said they had not been given this document to sign until after they had made the payment.

They added that at the time they had been assured verbally that they could get their money back and that they had felt under pressure to pay the money immediately.

David Smith, a leading specialist in residential landlord and tenant law, said the practice was legally questionable.

"Asking somebody for money, without being able to see what that contract is about, to do a viewing, would quite likely to be seen by professional people in the property sector as unreasonable and unfair behaviour," he said.

"It is therefore is likely to be an offence under the consumer protection from unfair trading regulations."

Ms Onn called for the government to give greater protection to renters.

"Letting agents as well as landlords should be properly regulated," she said.

"Of the 8,000 letting agents we've got around the country, only about half of those are voluntarily signed up to a code that means that they will operate to the highest professional standards. That means that half of them are not."

Flintons denies any wrongdoing.

It said it did not charge any fees for viewings and payment was taken only when someone confirmed they wanted to rent the property.

It said these payments were taken as a "holding deposit" - money paid to a landlord or letting agent to reserve a rental property - which were always non-refundable and that it did not believe there would be any purpose in taking deposits if the individual could get their money back.

It added that all those featured in the BBC's report had been made aware that their deposits were not refundable and it did not agree with their version of events.

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1 hour ago, thewig said:

Scumbag tenants exist to be gouged, don’t like it? Become a legendary homeowner and walk tall

And from the bank's perspective-

"Scumbag mortgagees exist to be gouged, don’t like it? Get a banking license and walk tall"

 

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Why would you give a "deposit" to potentially view somewhere you maybe would rent out? Why would you expect to get it back?

If you get burned by this, you pretty much deserve it IMO. 

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Just now, Locke said:

Why would you give a "deposit" to potentially view somewhere you maybe would rent out? Why would you expect to get it back?

If you get burned by this, you pretty much deserve it IMO. 

It seems from the article they are calling it a deposit.

Do the DPS rules not apply in that case in which case each candidate can get 3x their deposit back using that system?

Anyone know?

From the article:

"Israel Kujore and his friend Harry responded to one of Flintons's adverts.

He said they had gone to see an agent who had told them they needed to pay a deposit to see a room but that the money would be refundable."

 

 

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More EA Desperation For Income?...

No... folk desperate for shelter being exploited.  This kind of practice reflects the balance of power and is inevitable given current UKGov policy.  Banning letting fees etc won't help...EAs will find away around this.  Only a change in the balance of power between landlords and prospective tenants will bring this kind of exploitation to an end.  This is achieved through a shift in the supply and demand dynamics.  If we had an over supply do you think EAs would charge to view...???  Of course not...

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1 hour ago, ebull said:

Do the DPS rules not apply in that case in which case each candidate can get 3x their deposit back using that system?

Ahahaha that's a great point, how sweet it would be for the agents to get shafted that way, but I fear that as they didn't actually open an AST with the agent, those rules do not apply.

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2 hours ago, Tes Tickle said:

Apparently they were told that it would be returned if they didn't want it.  That's why they expected to get it back.

When I went to view a motorcycle to buy, the owner wanted to hold the value of it in order to do a test drive. Obviously in case I crashed it.

How would you convince someone that they need to give a "deposit" to view something they have no capability of damaging? Honestly, these lads are going to struggle in life if they're that gullible and naive.

 

£300 is a cheap lesson tbh.

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I'm puzzled by this bit...

Quote

What can I do? I don't have the money to sue them. I don't have legal expertise to deal with it - I'm powerless."

Wouldn't small claims be appropriate for the amount in question?

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I'm happy to report there's one less of the scumbags around this morning, one of the EA's on my high street has closed today it's a small high st, only about 10 shops 3 of them which were EA's - only 2 to go!

This is a fairly affluent part of SW London, lots of 3 and 4 bed family homes up for £750k +, nothing shifting, lots of reductions and we have our first casualty. I have to admit I let out an audible belly laugh as I passed this morning, I have zero sympathy as they have been willing participants in the sh@t show we currently find ourselves in.

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1 hour ago, Locke said:

Honestly, these lads are going to struggle in life if they're that gullible and naive.

 

£300 is a cheap lesson tbh.

If you are under threat of becoming homeless then you are going to be more easily walked into abuse like this.

Bear in mind how (deliberately?) opaque property law int he UK is. After all, how many thousands of tenants out there (regardless of age or experience) have no idea that a SPT automatically follows an AST?

These guys may be gullible and naive ... but then so are the thousands of folks who have fallen to other schemes by our esteemed agency friends.

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Agent denying BBC claims about charging tenants viewing fees is under renewed spotlight

https://www.propertyindustryeye.com/agent-denying-bbc-claims-about-charging-tenants-viewing-fees-is-under-renewed-spotlight/

An agent is under renewed spotlight after it denied charging prospective tenants viewing fees. The agent has also totally denied other suggestions.

The BBC’s Victoria Derbyshire programme featured renters who claimed Flintons had failed to return money to secure a viewing that they allegedly believed was refundable.

Tenants told the programme that they had paid £300 to view a property, which they said they had been verbally assured was refundable, only to later be told this was not the case.

Flintons, in east London, emphatically dispute the BBC reported version of events and said money was only taken from those who wanted to rent a property as a non-refundable holding deposit.

It now appears that Flintons may have been been displaying logos to which it was not entitled, but the company has refuted this too

The logos include SAFEagent, the National Landlords Association and its spin-off the UK Association of Lettings Agents, but both SAFEagent and the NLA have said that Flintons is not a member.

It has also emerged that director Runa Begum, which Companies House shows as the only named director of Flintons – a trading name of Flat Sharing which was incorporated at Companies House in February 2018 – was also once a director of Citiside Properties.

Earlier this year Citiside was criticised over the accuracy of its listings and also fined by Tower Hamlets Council over how its fees were displayed.

Citiside Properties went into administration in April and quit The Property Ombudsman at the same time. Five days later, Flintons joined TPO.

Citiside also features on the Mayor of London’s rogue landlord and agent database. This states that enforcement against the agent started in December 2017 for failing to accurately display fees and that it was fined £10,000 by Tower Hamlets Council.

A spokesman for Tower Hamlets Council said the fine had still not been paid and that the Citiside company rather than the individuals are responsible for it.

Companies House records show that Begum was a director at Citiside between December 2016 and May 2017 – months before the fine was imposed.

Flintons is on the same road as Citiside was, next door to its old address.

TPO yesterday told EYE that Citiside ceased its membership on April 5 and had complied with TPO membership rules, while Flintons was accepted for membership five days later.

A statement from TPO to EYE said Flintons had confirmed in its application the usual assurances.

These included that no Trading Standards office or any other body was taking, or considering taking, action against anyone involved with the firm, and that it was not insolvent.

TPO said: “TPO had no reason to reject their application at the time and will continue to resolve any complaints raised by consumers against Flintons.”

It was unable to comment on whether there had been any complaints about Flintons.

Meanwhile, tenants are still posting reviews that refer to Flintons under the Citiside Properties profile on allAgents, where it has a rating of 1.5 out of five and negative feedback about unreturned deposits.

Isobel Thomson, chief executive of NALS, told EYE: “We are aware of Flintons’ claims on their website that they are a member of SAFEagent.

“However, this is untrue. We have previously been in touch with Trading Standards alerting them to this.”

The SAFEagent logo was removed at the end of last week, but logos suggesting Flintons was a member of the NLA, UKALA and the Deposit Protection Scheme (DPS) remain.

The NLA said it has repeatedly asked for its logos to be removed.

Richard Lambert, chief executive of the NLA, said: “Flintons is not a member of the NLA.

“Similarly, Flat Sharing Ltd and Citiside, companies with links to Flintons, have had memberships with UKALA.

“These have been terminated for various reasons, such as failure to produce audit documents. We have repeatedly requested that these companies remove our logo from their website.

“Charging tenants viewing fees is completely inappropriate. It’s not something we come across often and will rightly become illegal when the Tenant Fees Bill is law. We recommend any tenant who is asked for a fee to view rather than to secure a property not to pay.”

DPS could not confirm whether Flintons used its scheme but said tenants can check online at https://myaccount.depositprotection.com/#tenancy/checkDepositStatus 

A spokesman for TPO added that displaying logos for associations or schemes that an agent is not a member of is a defined banned practice under the Consumer Protection Regulations, allowing Trading Standards to take direct action on the matter.

If a consumer complaint arises from that issue, then TPO would look at that complaint, the spokesman said.

In a lengthy statement, Flintons said last night:

“Flintons was an approved SAFEagent through a full membership with UKALA. Due to a document provided late due to a member of staff being off on sick leave and unfortunately failing to delegate this matter, our membership was suspended by default and as such, the SAFEagent logo was removed from the website.

“The other logos that are displayed is again through membership with UKALA and has remained on there on the basis that we have been in continuous discussions with them and have already received confirmation that the documents that were sought have been accepted and we are simply waiting for a specific department at UKALA to finalise our full re-instatement. UKALA have not raised any issues with this.

“Runa Begum was previously a director for Citiside Properties Ltd for a short period and during her period as director, no issues were raised against the company.

“We understand that although the London Borough of Tower Hamlets’ Trading Standards did issue Citiside Properties Ltd with a fine for a failure to display fees along with numerous other agents that included large high street names, this was not an issue that existed while Runa had been a director and arguably had she remained and the status quo were to be maintained, there would have been no fine forthcoming for the company.

“We submit that it is entirely improper to try and link Mrs Begum to a third party organisation’s operation at a time where she would have had no knowledge or control for the same and where no issues existed when she was involved with the said company.

“As to whether any fine will be paid, surely this is a question to put to the company and not to us.

“Runa has not received any correspondence from the Ombudsman as to her previous involvement with a different company which is perfectly understandable as we cannot see the reason as to why there would be any need for this nor how this could be proper.

“As we have stated, there were no issues that she was aware of during her time with the company as an officer of the company.

“We understand that the company’s offices have had two routine visits from Trading Standards both of which resulted in no action needing to be taken.”

We have also provided Flintons ‘full response to the BBC programme below:

“We deny any allegation that prospective clients are asked to pay a holding deposit to be able to have a viewing. A holding deposit is only taken where a prospective client wishes to exclusively reserve a property for themselves and the property is then taken off the market and not offered to any other person.

“Whilst we have been informed of three instances where prospective clients had raised complaints, we provided suitable responses and believe that we demonstrated that the version of events that the complainants had provided were not entirely accurate and there was clear knowledge that any deposit taken was non-refundable.

“As the BBC has confirmed, all had signed holding deposit forms clearly stating that the deposit was non-refundable as it states at the beginning of the document and is clearly visible and is not something that can be missed or overlooked. It is not accepted that they were given the form after payment had been taken nor was there any assurance that the holding deposits were refundable.

“We note that the BBC also undertook an undercover investigation where they used undercover reporters to look into our practices. They have confirmed that their undercover reporters were clearly told that any deposit would be non–refundable prior to any funds being requested when they showed an interest in a property. This we say clearly supports our position.

“We confirm that we are an agency that assists numerous clients and the complaints raised only form a very small percentage of people who have engaged with us and the vast majority of our clients are happy with the service that we provide.

“Notwithstanding our position, we have reviewed our procedures and have provided further training to staff and have also now amended our holding deposit form to further highlight that the deposit is non-refundable if a prospective client changes their mind.”

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On a related note, I just remembered that I did not have a £20 holding fee returned when i rented the place i am currently in . 

Google seach for "is a holding fee refundable"

 

Quote

Usually a holding deposit is set against a security deposit, or is refunded when you move in. If the agreement is cancelled, and it's not your fault, the holding deposit should normally be returned to you. A security deposit is paid to the landlord as security in case you damage the property or don't pay the rent.

Link

 

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I came across a similar company (about 5 years ago) and it was charging a fee to view a flat in a prime location, which was ridiculously cheap. Mind you, this was in Germany. When I researched it online, I found that this company was blacklisted by the UK FSA. It's basically a scam. I'm convinced that the flat was never even up for sale.

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  • 140 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
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      • Even
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      • up 5%



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