Private Tenants Are Being Ripped Off and Letting Agents Can Provide the Answer

An alarming number of private tenants - sixty per cent - believe UK letting fees are poor value for money, according to a recent poll. The survey, carried out by Populus, found that nearly half of private renters felt that letting fees did not reflect the time and effort put in by the letting agent.

An alarming number of private tenants - sixty per cent - believe UK letting fees are poor value for money, according to a recent poll.

The survey, carried out by Populus, found that nearly half of private renters felt that letting fees did not reflect the time and effort put in by the letting agent.

The figures reinforce the conclusion the Competition and Markets Authority (CMA) came to on the private lettings market - it is 'dysfunctional'.

The four million private renters in the UK make up almost one fifth of the total housing market.

In urban areas, private renters account for a much higher percentage of the housing market. In London for example, private renters make up over a third of the total housing market.

There has been concern for some time at the high cost of 'application' and 'administration' fees.

A survey of 60 lettings agents last year found average UK private tenancy administration fees total £350. This consists of £250 in 'application fees' and £100 in 'inventory costs'.

Worryingly, in London, these fees were sometimes more than £700.

The current UK letting system also takes a considerable amount of time to complete, averaging 8.5 days.

What was evident about the Populus poll was that private tenants are not happy with the status quo.

What was more interesting, however, was that there was no real support for more government regulation to solve the lettings market - red tape is not the answer.

Instead, there was overwhelming support (fifty seven per cent) for an 'innovative technical solution' to revolutionise the lettings market.

Why private renters should so enthusiastically favour technology over government regulation, one can only speculate. I would hazard a guess that because people have seen technology play a positive role in their lives, they think that it can provide a solution to this problematic market.

Crucially, though, private renters want applications to be faster and to be better value for money. There is very little the government can do to achieve either of these.

The two key players in this ongoing saga - the tenant and the agent - both have reason to embrace a technical solution.

Private tenants are frustrated with poor service and unjustifiable fees from letting agents. Letting agents recognise that they have lost customer support and need better tools to leverage economic efficiencies in order to lower their cost base and fees.

The lettings market is broken. Tenants are looking to technology not policymakers for an answer.

The Populus poll shows that tenants do not want more government red tape and letting agents most certainly do not want it. This dysfunctional market has one last chance to embrace a technical solution and must take this opportunity to self-regulate effectively.

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