Following the introduction of the Renters’ Rights Act, letting agents are being accused of adding new landlord charges that were not part of standard fee structures. These changes coincide with a shift in the sector’s revenue model, as the move away from fixed-term tenancies has reduced opportunities to earn traditional renewal fees and commissions.
New fees spark landlord concerns
Some firms now separate costs that were previously bundled, charging for compliance work, financial statements and the paperwork required when rents are raised. The shift reflects the extra administrative load created by the new regulatory regime. Agents have also introduced separate fees for completing the specific paperwork mandated when landlords increase rents, further itemizing services that were once standard.
One agency, KFH, lists a charge of £12 plus VAT for each additional financial statement. Other companies reportedly ask for as much as £300 for compliance audits, according to the report.
The British Landlords Association has urged property owners to read their agency agreements closely. A spokesman warned that “trying to recover increased operating costs through unexpected or questionable add‑on fees risks damaging the trust between landlords and their agents.” The association acknowledged that the reforms have increased administration for agents but cautioned against introducing such unexpected charges.
Chris Norris of the National Residential Landlords Association said some businesses could profit from landlords’ compliance worries. “Lots of landlords at the moment are fairly concerned because there are quite big, chunky sanctions attached to getting some of this stuff wrong,” he told the report. He noted that landlords rely on their letting agents to ensure they are compliant and doing everything properly, suggesting that some firms are cashing in on the resulting concern and confusion.
Norris added that certain landlords might view the practice as “underhand,” while others could accept the extra fees as part of doing business.
Read Also: Housing market steadies as rent expectations surge
A survey by Goodlord found that almost 25 % of landlords reported higher agency fees since the Act took effect. The data suggest the issue is not limited to isolated cases.
Given the pressure on profit margins, it is plausible that agencies will continue to itemise services, especially if landlords remain uneasy about compliance. If the trend persists, the market could see a gradual normalization of these add‑on fees, potentially prompting further scrutiny from consumer groups.
Agents argue extra work justifies charges
Representatives of the sector argue that the additional paperwork is a real cost. “Both agents and landlords are expected to do more paperwork to be compliant,” said Greg Tsuman, managing director of lettings at Martyn Gerrard. “If a landlord would like to outsource that, I think it’s perfectly reasonable that the agent charges appropriately.”
Tsuman noted that landlords are already facing tighter profit margins, making it harder to absorb any unexpected expenses. It’s a bit odd, but they claim it’s necessary to keep operations running smoothly.
EYE has approached KFH for comment; no response was recorded.
