UK Landlord Forum / Life

My current tenants have been living in my property for 6.5years. My problem isn't with them, it's with the estate agents.
At the time, I signed an agreement with them which pays them 7% of the monthly rent as a commission. This is just a finders fee.
I thought this fee was the norm at the time in that area, and maybe it was, but now i see estate agent advertising finders fees of £240 or 90% of the first months rent.
I'm wondering how to get out of the contract. The only thing I can think of is to get rid of my tenants and start again  with new tenants and a new estate agent. This seems a bit extreme though. But after paying nearly £1000 a year to estate agents who have no further role in the process (apartfrom renewing (and charging me for ) a new tenancy agreement every two years, i'd Like to try to get out of it!

Thanks in advance for advice.

Have you looked through the agreement you have with the agent to see how the contract may be terminated?

Thanks for your reply. It doesn't mention terminating the agreement. It does however say that even if we dispense with the agents services, we are still obliged to pay the commission.

A lot of Landlords have signed up to these things with eyes wide closed.

Maybe some day in the future it will be considered a mis-selling scandal all of its very own... but the fact is you signed your name to a contract. Just like you'd not want anyone to go and unilaterally break a contract they'd signed with you, the same position will be held by the Agent.

Your options appear to be... 1) break it - say to them - you've had enough from me, do your worst... 2) negotiate - try to get them to be reasonable, but what's it in for them?, 3) end your tenancy and see if there's a way you can maintain the same Tenants (or not) or 4) put up with it - because, after all, the hassle and expense of you really changing Tenants is gonna hurt too... risk, fees, time, void.

I'm minded to think 4 or 2 take it for me... but 4 with a slight alternation, along the lines of below...

You just don't need a new tenancy agreement every 2 years... what is going on there? Let it ride out to SPT... it sounds (maybe I'm reading between the lines) that your Tenants would stay on and on and on and on (Energizer Bunnies?)... and the Agent is charging everyone to write up a new AST (change the date)... just let it go to SPT next time - your Tenants will thank you as well.

For 1 you'd need to be cool with a bit of brinkmanship and it also assumes the Agent is not doing rent collection on your behalf as well... basically, do your Tenants pay you directly? If so, then is there room to increase that rent, modestly... the Agent would never know and you're in the clear with your ill-gotten gains. If the Agent is doing rent collection for you then it's not really as you describe it... it's more.

BTW... you realise it, obviously, but it's worth clearly saying that - yes - you've been bilked. Such easy money... why isn't everyone an Agent? Also, I do have these magic beans that I just don't need any more, would you be interested..?

Upad - for example - is £45 to do Tenant Find. I use it. I write my own advert, I do the viewings, I kick off the referencing, I do the selection, I do the Check-In, I do the Inventory and I self-manage (including collecting the rent)... when you say the Agent does nothing at all for the 7%... is it true? Or do you mean they do nothing now? Because they may have done plenty at the beginning to ensure you get these Tenants that you don't have a problem with and who have stayed on for almost 7 years - a Landlord's wet dream, right?

Lemons... could you post the clause from the agency agreement that covers the charges?

I had someone that paid the fees like you have but the agreement stated the fees were chargeable "on renewal" *. Is that the same case for you?

If so then just do as Hippo has stated and don't renew the agreement.  After 6.5 years your tenant isn't gonna jump away and you certainly don't sound you need the certainty.  Also is the tenant also paying a renewal fee(?).  They'd be chuffed to not have to pay (as you would be).  See also:
https://www.propertyinvestmentproject.co.uk/blog/this-is-how-i-helped-my-friend-stop-paying-a-tenancy-renewal-fee/

How easy your argument is depends on how the agreement is wrttten.

[* We claimed almost all the money back after threatening court action as the agreement has become an Periodic Tenancy sometime ago].

Sorry for the delay in replying, I've been away.

Here's the part which discusses fees. I've unfortunately just renewed the contract (in November 2018), for another 2 years.

Thanks for replying,
Paula

Here's the contract.

I was wrong, this wasn't just a finders fee as the estate agent collects the rent everything month and then pays into my account.
Does this mean it's then harder for me to get out of the contract with them?
Still seems a bit of an excessive charge for just passing on the rent to me every month...