Estate agent Knight Frank’s quarterly report Local Lettings Market Insight aims to keep landlords and tenants up to date with the latest movements on the market. There’s a few statistics there and a rather interesting interview with the head of the local lettings department. For the Summer 2010 edition they had to answer: “What question do tenants always ask?”

Zoe Sexton – Head of Kensington lettings
“Will the landlord take an offer?” We would say is the most common question. There are still a few people who are looking for a ‘bargain’ but with the shortage of stock and rents going up we are trying to let all our applicants know about what is happening in the market so they can make educated decisions and put in the right offer. Other common questions are “When was the property last refurbished?” and “Is the property managed by Knight Frank?” Newly refurbished and professionally managed properties are always in demand and let quickly.

Sophie Woolfenden – Head of Notting Hill lettings
Prospective tenants can, and do, ask almost anything! That is why it is so important for Landlords to be as flexible as possible with regards to terms, break clauses and furnishings. If you are prepared for at least some of these questions they seem a lot easier to deal with. The usual questions tend to be one or all of the following: Is this a safe neighbourhood? Is the price negotiable? How many minutes to the tube?

Vanessa Evett – Head of Canary Wharf lettings
The most commonly asked questions that we come across are “Does this development have a gym and swimming pool?” or “Does this development have 24hr Concierge?”. Once an offer is agreed, we tend to hear “Why do we have to pay Stamp Duty Land Tax?” and “Where is our Deposit held?”.

Ruth Barr – Head of Wimbledon lettings
How close is the station? Wimbledon has excellent transport links to the City and West End. Canary Wharf can also be reached within 30 minutes from Wimbledon Station.

Click here to read all the issues of Knight Frank Local Lettings Market Insight.

Hi there, I’m a 21 year old university student who is very worried about the risks involved when signing up to a contract with an estate agent. A year ago, naive me and three other students went to view a flat along with a representative from the estate agent. The four bed property was well presented, but it also was well above our price-range. The representative knew this but assured us that she could probably “have a word” and “sort something out”. It screamed sophistication, independence and freedom! We really did like the place and she knew it. I started to feel uncomfortable as she sensed the excitement within the group, but a few well rehearsed lines were slipped in here and there and soon we were all convinced that there were was another potential buyer on the way who was very interested, and if we wanted to secure the flat we must place a deposit before 5 p.m. that day.

Off we ran to the nearest cash point, withdrew a total of £280 from our precious student loans and straight to the agency. They had our contracts ready and waiting still warm from the printer. I can’t recall the exact amount they had wanted from us, but I do know we were being charged for credit checks, even though all of us had opened our very first student accounts that same year. We were also being ripped off for the cost of inventories. There must have been a lot of other ‘expenses’ as the grand total per student including our deposits came up to over £1200 each. They had somehow claimed £400 for their “services.” It didn’t matter that in order for us to pay the rent, we would have had to up the hours from our part-time student jobs and almost completely neglect our degrees. Luckily someones relative intervened and we pulled out. We only ever got £140 back, which we shared between us.

This year I’ll be going through another property hunt. If you have any advice on how we can avoid this sort of thing, please let us know.

Eagerly awaiting a reply.

J.

Our Answer:

An agent should provide clear information on what costs would be incurred, including any potential future financial liabilities to the agent that are reasonably foreseeable and quantifiable, says the statement on the Association of Residential Letting Agents (ARLA) website. It is totally understandable that as a first time renter you had no idea that letting agent services can cost hundreds of pounds – there was no word about it on the advertisement, nor the agent’s website. No wonder one feels being deceived and trapped when the bill is presented only after there is no going back.

Should you decide to go through the letting agent again, please make sure you get all the expense details before the viewing takes place. Ask how much exactly do they charge for their services for the property you are interested in. Write these numbers down and have them with you for the letting agent to confirm on the site, should you decide to pay the holding deposit there and then.

Don’t hesitate to complain to the associations and schemes the estate agent belongs to if you feel you have not been treated right. ARLA’s E-mail is info [at] arla.co.uk. The Property Ombudsman complaint forms are available HERE.

If you want to avoid letting agent costs altogether, you can find some links to sites that have offers from private landlords HERE. Please note that here are many fraudsters advertising on these sites, especially during the coming busy months. Read Gumtree advice on how to stay safe HERE.

How exciting!

Jacob Fox, the estate agent with offices in Canary Wharf E14 and Wapping E1, will soon open their new website.

We’re assuming it won’t be long now, as …

… this is how the picture on the front page looked just 2 weeks ago.

Jump to Jacob Fox website.

Benham and Reeves Residential Lettings reports that the enquiry levels are up, with a clear rise in demand from overseas tenants looking for a home to rent in London:

“The lettings market is in full summer mode and demand for rental properties is strong throughout our eight London offices. In particular, we’re seeing an increase in enquiries from prospective international tenants, which may indicate that multi-national organisations are starting to relocate staff again.” reports Lettings Director Marc von Grundherr.

“Conditions have changed dramatically though and this is definitely now a tenant’s market. All our offices are very busy but tenants are looking for good deals.” continues Marc. “In fact, rents have come down by 10%-30% depending on the type of property and tenants are taking full advantage of this. The last five years have seen a landlord’s market but the market is very different now and landlords need to recognise this in order to minimise void periods.”

Read more HERE.

Estate agent Winkworth has decided not to charge admin fees for several rentals available through their Kensington and Chelsea branch.

We hear that Winkworth’s London offices usually charge tenants £150+VAT admin fee.

Here’s just a few examples of the properties for which you don’t have to pay the administration fee:

3 bed flat £2750 pw Parkside, Knightsbridge, London, SW1X
3 bed house £2250  pw Lincoln Street, Chelsea, London, SW3
3 bed flat £1900 pw Lowndes Square, Knightsbridge, London, SW1X
2 bed flat £1350 pw Milner Street, Chelsea, London, SW3
2 bed flat £750 pw Ovington Square, Knightsbridge, London, SW3
2 bed flat £650 pw Egerton Gardens, Chelsea, London, SW3
1 bed flat £575 pw Ovington Square, Knightsbridge, London, SW3
1 bed flat £400 pw Chelsea Cloisters, Chelsea, London, SW3
Studio flat £375 pw Nell Gwynn House, Chelsea, London, SW3
Studio £210 pw Sydney Street, Chelsea, London, SW3

There’s actually more – click here to browse all Winkworth’s offers in Knightsbridge and Chelsea area.

In the light of the recent ruling on the OFT vs. Foxtons case, and with The Property Ombudsman just confirming there are too many disputes over hidden agent fees – wouldn’t it be nice if one of those Great Code of Practices we hear about started requiring letting agent charges to be presented on their websites in a clear manner, too?!

If possible, not just on a separate page on agent’s website but separately on all the rental listings.

Knowing the total expence of renting the property before even viewing it would be extremely helpful for the tenant. It’s essential to know all the costs when planning the finances before the big move, seeing as the deposit and rent often make up a significant sum already.

We did a little survey among the agents we have listed on our London Letting Agents page and found that only a few have stated how much their services cost. We hope to post all the numbers on our website shortly. The most expensive letting agent fee we’ve heard about so far is £375.

The relationship between renters and letting agents could be so much better with a little more transparency.

Quick poll for everyone currently browsing the property portals, searching for that perfect property to rent!

The National Federation of Property Professionals NFOPP has produced some video guides on renting in the UK.

Click on the title to watch the videos:

- All about tenancies
- Deposit Protection
- Understanding your Energy Performance Certificate
- Inventories
- Why choose an ARLA agent?

NFOPP TV

The Estate Agents Public Register can be browsed either alphabetically or by date. The list contains the names of individuals and companies with whom you better avoid making any deals in the property business.

We will have to keep an eye on that list to make sure that none of them appear on our London Letting Agents page.

Via The Rat & Mouse

EAT reports:

The Ombudsman found the agency failed to provide a copy of the tenancy agreement prior to occupation by the tenant; did not notify the landlord of key terms in the new tenancy agreement; showed a “destructive / unprofessional” attitude because another agent was instructed to sell the property; and omitted to meet complaints with appropriate response and failed to respond to phone calls and emails throughout the period 2005-2007.

The firm will not be able to sell properties without belonging to a redress scheme can legally still deal in lettings.

Property Ombudsman offers free dispute solving for all the registered firms’ clients, and has the powers to award compensation should you be treated badly. Find out if your letting agent is registered with the scheme HERE.

One step closer to the licensing of the letting agents…

Citizen Advice Bureau has just released an interesting report named – “Let Down”. According to the survey, private tenants are badly let down by a system that allows letting agents to operate completely unchecked, routinely ripping off tenants by imposing unjustified and excessive charges and providing a poor or non-existent service.

Key points from the report:

- The absence of any statutory regulation of letting agents means that using an agent can be a costly and risky business for tenants.

- An online survey of 1,330 tenants who visited the Citizens Advice website over a 3 month period, found that 73% were dissatisfied with the service provided by their letting agent.

- Common concerns included difficulties in contacting the agent, serious delays in getting repairs carried out, inadequacies in the protection of clients’ money and the frequency with which additional charges were made.

- A survey of 424 letting agents found that 94% imposed additional charges on tenants on top of the tenancy deposit and rent/rent in advance. There was huge variation in the size of these charges. The charge for checking references ranged from £10 to £275 and the charge for renewing a tenancy ranged from £12 to £200. In some cases additional charges for a tenancy amounted to over £600.

- Less than 1/3 of agents willingly provided full written details of their charges to CAB workers when asked.

- Sixty one per cent of the tenants in the survey said that paying these charges was a problem. Some had to borrow the money, others had difficulty paying other bills or went into debt.

- More than a quarter of the agents said they did not let to tenants in receipt of housing benefit – a figure which rose to 48% in the south east.

- This report calls for the statutory regulation of letting agents. In order to obtain a licence, agents should be required to demonstrate professional competence, have adequate client money protection arrangements and operate a system for handling complaints and redress.

- Regulations should also specify that no additional charges should be made to tenants for activities which are part of the routine letting and management process. The cost of this work should be included in the rent paid by the tenant and/or the management fee paid by the landlord.

- The regulator must take a pro-active approach to compliance and should have an appropriate range of regulatory tools to enforce this. The ultimate sanction should be the withdrawal of an agent’s licence to operate.

- The Departments of Work and Pensions (DWP) and Communities and Local Government (CLG) should consider how housing benefit reform can address the reluctance of letting agents and landlords to let to tenants in receipt of housing benefit.

Download Let Down (*pdf).

The competitive environment for landlords means that rents fell again in the first 3 months of 2009, by 7.4%, and are now 18.2% below their March 2008 peak, and 3.6% below the previous market peak in September 2001, states the latest London residential property market review by estate agent Knight Frank.

The current review takes a closer look at the corporate market lettings:

- In terms of the types of properties in demand from corporate tenants, the general rules remain unchanged – neutral properties, wooden floors rather than carpets, open plan living, close to good travel hubs, and, for the higher price brackets, porterage and concierge services.

- While there is a bias towards new-build properties from most clients – US and European tenants often prefer a traditional house or flat for the “London experience”.

- What has changed through the recession has been the demand from corporate tenants for the structure of tenancies. There is a desire to achieve flexibility and certainty – with six month break clauses required alongside clauses providing the tenant with an option to renew for a second and even third year.

Download Knight Frank’s London Residential Review Summer 2009.

Estate agent Knight Frank’s website has been redesigned.

See if you like browsing the rentals in the grid view just as much as we do – jump to view all rentals in Greater London .

The photos are in much better size in the new version (image on the right; old version on the left).

The government plans to license all private landlords and letting agents. Read all about it from Times Online.

We are prepared for tenant licensing next. But then don’t think you’ll get away without a rental property certificate!

The annual Estate Agent & Letting Agent Awards ceremony was held at the Marriott Hotel on Grosvenor Square in London on Wednesday. 

Voted by the customers, these awards recognise the highest standards of customer service in the estate and letting agent industry based on research conducted amongst sellers, buyers and landlords throughout the UK, states the awards  official website.
  
London winners of the Letting Agent Awards 2009:

Crompton Estates
Deptford London
Winner of the Letting Agents Awards 2009 Gold

Martin & Co
Kensington & Chelsea London
Winner of the Letting Agents Awards 2009 Silver

Living Residential 
West Hampstead London  
Winner of the Letting Agents Awards 2009 Bronze

We noticed that the gold prize winner currently has only 6 properties to let in London, and that their homepage does not even have a proper listings section. So what is it that makes Crompton Estates so good that it is better than ANY other letting agent in London? We found the answer from the opening page of their website:

Whether you’re looking for that special place to call home, or planning to let out your own property, talk to Crompton Estates and you will be pleasantly surprised to see how refreshingly different we are. You will find honesty even if it is to our own short-term disadvantage, yes an honest estate agent!

Congratulations to all the winners!

PS! We have marked the winners on our London Letting Agents page as well. 

New York Habitat has just published their very first London Vacation Rental Market Report. 

New York Habitat has been offering rental apartments in London since 2002.

Download London Vacation Rental Market Report 2008.

One of the reasons why people don’t want to rent through the letting agent is because they have heard horror stories about how much they charge for their services. It might be a bit less safe to give that holding deposit to a private person but hey – at least you know you don’t have to pay any mysterious sums to get the flat. 

Patrick Collinson shares his view in The Guardian about how letting agents have screwed everybody during the boom years charging ridiculous amounts for their service:

 It strikes me that the main project of the lettings business over the past 10 years of buy-to-let madness has been to:

a) charge extraordinary fees to first-time landlords; b) try charging the same fees to the tenant; c) charge it all again at the end of the six-month shorthold tenancy; and d) disappear as soon as the landlord or the tenant needs something done.

I love the makey-up world of letting agents and their preposterous fees. The huge finder’s fee to landlords and as much as £400 to tenants for “administration” – which amounts to a few pieces of photocopied contracts. A credit check fee (£150?). An inventory fee (£80?). An insurance fee. A checking out fee. A cleaning fee. They simply make up these charges as they go along, hoping that the mainly young clientele think they have no choice but to pay up. These vulnerable young people, often laden down with student debt, are hit with a load of tripe. They are spurious items which, if they have any basis in fact, should fall on the landlord, not the tenant.

The Association of Residential Letting Agents ARLA is currently eagerly waiting for the government to regulate the business as more and more agents turn to lettings but who knows how long that will take. In the meanwhile, we think there are things that could be done right now to help make the market become more transparent, and service providers more trustworthy. 

ARLA should ask their member agents to publish the fees on their websites.

You don’t go to the shop and call the cashier for the price for each item you get, do you? Most of the letting agent listings do not display a tag with the real price, and this does make renters cautious. Who knows how much they charge – I’d rather find a home advertised by the owner at Gumtree, even if there are more risks involved in dealing with the private person.

We think the tenants should be able to conveniently see all the costs that renting through letting agent involves in order to be able to plan ahead, and compare different service providers. Either show them in the listing or on a separate page that could be easily found.

Adding a little transparency would be really good for the market. It would be a steady step towards gaining back that trust the letting agents seem to have lost in public’s eyes.

The estate agents’ portal PropertyLive has finally revealed the identities of the people on their site.

They are in fact all working in the property industry, and one of the most interesting characters is indeed Mr. Dickinson from Douglas & Gordon. Just as we suspected.

Too bad City of Westminster is still the only area we can search. 2241 rentals available there at the moment.

We have recently received a few comments advising us to not promote letting agents who are known as dodgy.

If only we were experienced enough to be able to tell who truly deserves to be condemned!

Agent rating websites such as AllAgents.co.uk are full of reviews about agents. Buyers, sellers, renters and landlords are urged to rate and comment them to help other people make better choices. Now almost all reputable agents there have received some very poor reviews. Looks like any agent could become our worst nightmare! Even the agent we’ve had the most pleasant experience with has been referred to as dodgy.

If we don’t know the whole story, then we cannot be sure we’re not about to spread a rumour here that is untrue. The “well wisher” could easily be a competitor, could be leaving out some important details, or is just evil by nature. Just kidding with the last one.

We actually have condemned a few agents proved to be scammers. Remember Hot Lets?

There’s a comment on hold in our blog that says the agent we talk about has deceived them out of £2500… :S That is basically all they say, too.

By publishing this comment that contains such little information, we risk turning our blog into a toilette wall in the long run. Also, would we be in violation of the privacy law if we made accusations and named names without a court judgment or the accused one’s consent?

We have now E-mailed the person who left us that comment, asking if they could tell us the whole story. We’ll see where it leads us.