A city council has decided to consider launching its own private letting agency.
Labour-run Cambridge made the decision unanimously.
Cllr George Owers said that local letting agents had too much power, which they used to “extort as much money as they possibly can in hidden fees and charges”.
He said: “All Cambridge renters deserve the option of a social letting agent that will not profiteer and will prevent people having to put up with the scourge of all these fees and inappropriate practices.”
He said the council’s intervention may force some private firms to change their ways.
Cllr Peter Roberts said many lettings agents behaved responsibly but that those who did not were “absolute rotters”.
However, the council’s decision does not seem to have gone down well with everyone.
A reader of the Cambridge News posted: “The public sector interfering with private sector business. What can possibly go wrong?”
The newspaper’s report is here:
Comments (10)
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Bad Agents deserve "outing" as much as bad Landlords, bad councillors etc. However, it is beholden on a councillor to check his/her facts before before spouting off in the media with complete mis-information.
A private business has to make a profit to operate & tenants are engaging an agent in a business transaction to enable them to move into a property and a lot of administration is involved. Landlords also pay a fee to an agent as there are costs involved on their side of the process. It is crass misunderstanding to assume that if tenants did not pay an admin fee it would be cheaper – they would pay for it in the increased rent that a landlord had to pay for the service being provided by the agents. Reasonable fees have to be paid for somewhere and at least the current way should be transparent.
I understand from various media sources that the councillor also included the cost of the deposit charged in his press claims. I wonder if anyone has pointed out that a deposit remains the tenants money but is protected in a government backed deposit scheme until the end of the tenancy where it can either be returned or due charges deducted by agreement or arbitration.
As for hidden fees, the council should be using existing powers to challenge and prosecute agents who do not comply with with the Advertising Standards Agency requirements for all agencies to clearly advertise their fees. There are plenty of powers open to councils to engage agents and hold them to account, they just don't choose to use them. I would suggest that active policing of the private rented sector would be far cheaper than a council run letting agency and would impact the whole local sector in a positive way rather than skim off a few properties from a few landlords.
Agents charging fees for a service? How dare they?!
I understand the council is applying for a grant to set up this business, rather than a loan. This smacks of unfair competition and I would have thought might be actionable under the unfair competition laws.
"“All Cambridge renters deserve the option of a social letting agent that will not profiteer"
Its like saying everyone deserves to by food from supermarkets who will not profiteer. How much revenue do Agents generate for the Treasury?
As regards hidden fees – where has he been?
Sadly the point is being missed. Why does someone who pays nothing into the system deserve to a home that is tax payer funded at the rate of a private rent?
The local authority sold off council stock. What did they do with the money? Certainlt did not reinvest in building more homes did they.
If Cllr Peter Roberts actually knew anything about anything he would not make the comment he has. How will it be funded? Again from tax payer money. Shame on you!!
Personally I believe that it is the local authorities across England & Wales who are absolute rotters.
Well if they do this as well as everything else they touch then God help tenants and landlords! Just shows the very deep levels of misunderstanding about what an agent actually does and what it costs. If you are using the 'Public' purse to fund everything then I suppose you can get away with a 'fee-free' model if you like. At the risk of sounding extreme it's Socialism bordering on Communism!