Hello Neighbour is urging the government to ban excessive letting agent fees, a practice that it claims costs landlords more than £2bn annually in London alone and contributes to rising rents for tenants.
In letters addressed to deputy prime minister Angela Rayner and housing minister Matthew Pennycook, the company says that letting agents routinely charge landlords up to 20% of the annual rent, with fees that often escalate as rents increase.
The PropTech firm claims that even more concerning is the widespread use of restrictive contracts by some of the UK’s largest letting agents. These agreements, it says, lock landlords into long-term commitments with hefty exit penalties and lengthy notice periods; stifling competition, discouraging investment, and worsening the UK’s rental supply crisis.
The company is calling on ministers to ban ‘punitive’ exit fees and ‘unreasonable notice clauses’ alongside the broader rental market reforms proposed in the government’s Renters’ Rights Bill. Hello Neighbour believes these straightforward changes could significantly ease the housing shortage and lower costs for both landlords and tenants.
Richard Jenkins, co-founder and CEO of Hello Neighbour, said: “We believe these proportionate changes would enable the residential letting market to modernise, remain competitive, and hold firms to greater account. By accommodating these reforms in the Renters’ Rights Bill or through other relevant measures, government can unlock a fairer, more dynamic rental market that benefits tenants, landlords, and the wider economy.
“Our own research shows that when landlords reduce unnecessary costs, many reinvest those savings into improving their properties or expanding their portfolios — delivering direct benefits for tenants in the form of either rental reductions or lower annual increases, as well as helping to meet national housing goals.”
Oh dear… it’s Government regulation that’s stifling the rental market. Stock is reducing as Landlords exit and the 5% 2nd home greedy tax has discouraged further investment. Not letting fees from professional agents circumnavigating all these changes and ensuring compliance.
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After reading the RRB HOL report yesterday its looks like they are going to ignore any potential amendments and rush this through, I doubt if there will be any Landlords in 5 years.
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Common storyline. A proptech entrepreneur realises their latest invention isn’t going to save the world and make them millions so what do they do? Attack the high street agent and call their fees excessive! It’s getting a bit boring now!
If they genuinely cared about landlords they’d focus their efforts on lobbying the government for fairer tax rules, cheaper licensing fees and a loosening of all the other punitive measures put in place over the years instead of attacking the very industry that runs and manages the PRS!
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Great comment. The Hello Neighbour requests are actually embarrassing – ‘pls can you prevent different charging structures in a free capitalist market’! The customer has the freedom to choose the quality of service they want and the fees will reflect that.
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Richard Jenkins, co-founder and CEO of Hello Neighbour, boo f*****g hoo
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Best comment for his obvious advertorial.
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Lee245 above comment hits it on the head – a new “kid on the block” whinging.
Might their “energy” & new found enthusiasm be best put towards the likes of Rightmove – who are just milking it.
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I wonder if they googled ‘Hello Neighbour’ before choosing that business name. I did (because never heard of them) and top result was…….
“Hello Neighbor is a stealth horror game about sneaking into your neighbor’s house to figure out what horrible secrets he’s hiding in the basement”
Not the greatest tagline for a property company.
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There’s always merit in challenging practices that no longer serve customers well, and I can understand why Hello Neighbour is seeking to rebalance the market in its favour. But it’s important to acknowledge a few realities behind the headlines.
While some agents do charge high fees, most full management services — particularly outside central London — deliver 365-day support, emergency call handling, compliance checks, rent collection, and tenancy management for a figure that often works out at less than 17 pence an hour. When compared to other professional services, that’s remarkably good value.
More importantly, these aren’t compulsory fees. Landlords who choose full management are usually paying to avoid hassle, risk, and time drain. Suggesting they’re being exploited might overlook the fact that many actively value — and rely on — that support.
Contracts with notice periods and renewal clauses are standard across many industries. There is room for improvement and transparency, of course — but we should be careful not to conflate commercial terms with anti-competitive behaviour. Agents will rightly point out that consistency of income supports staff wages, service levels, and ongoing investment in their communities.
If Hello Neighbour has found a model that can sustainably deliver for landlords, tenants, and local economies, that’s to be welcomed. But modernisation shouldn’t come by dismissing the value of professional agency work. Letting agents are not the problem — and when supported by the right tools and infrastructure, they’re a big part of the solution.
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Sadly, we see more of the same old, tired rhetoric of high street/full service = bad; digital, arms-length, low cost = good. It is so, so boring. Very few agents in the UK charge 20%- and Hello Neighbour absolutely know this. What is more, it’s an open market- landlords are aware of fees and costs before signing a contract and therefore are fullt aware of what they are committing to and why- or are they suggesting they are incapable of this?
Interestingly, their ‘letting full service’ costs £1440 (or £1200 + VAT). At £800 pm rent that’s a 15% fee so it’s comparative, isn’t it!? Weird that!?
Last tax filings show cumulative losses to date of just over £6m. Isn’t ir interesting how many companies that lose money trying to undercut the industry pricing model, then attack the industry pricing model. Our industry averages a 16% profit margin- hardly taking clients to the cleaners is it!?
As others have already said, if you want to really support landlords, petition government, engage with organisations like TLIC, work WITH other letting agents to create a better landscape for Landlords and the PRS as a whole, rather than drssing up self-interest as anything else but.
Yawn!
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Oh dear, looks like the writing is on the wall for these lot !!! More clients and tenants for the big boys whom are growing by the day as the RRB puts the final nail in the coffin for the rogue landlords and estate agents whom were late to the Rental party!!!
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But its OK to let the utility company’s take the shirt off peoples back’s, got it.
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One look at the accounts of hell neighbour at companies house ought to be enough to see that they won’t be around for long.
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