A specialist recruitment consultancy says that the tenant fees ban will have a serious impact on staffing levels in the lettings sector.
Property Personnel managing director Anthony Hesse said: “This will send seismic shockwaves through the lettings sector and there’s no doubt that staffing levels will be hit.
“Letting agents are having part of their bottom line swiped away, despite the fact there is still administration that they will have to do. So they are going to have to do more work for less income.
“Furthermore, this is a move which is clearly designed to shift the costs to landlords.
“But landlords will do everything they can to avoid any extra charges. And for some, this will include deciding not to instruct a letting agent at all in the future.
“All of this will reduce the amount of money in the pot for letting agents’ salaries. We are already struggling to fill these positions as it is – but this move is likely to drive even more lettings personnel from the industry, who will be hard to replace.”
Hesse added that the industry is “getting battered from all sides”.
He said: “It’s such a marginal industry, and if companies are not earning enough money to pay their staff properly, employees are going to vote with their feet.
“This will be particularly acute in firms where tenants’ fees have provided a proportion of an individual agent’s income.
“In bigger chains, those carrying out tenancy progression will be on a flat salary. But in a small independent firm, a level of commission will have been involved – which has now disappeared altogether.
“Ultimately, for many letting agents, these fees were a crucial revenue stream and profit margins have to be protected.
“From a recruitment perspective, it’s hard enough to find people and get them to stay in the business as it is. I suspect that job has just become even more difficult.”
Comments (3)
It will stop new lettings business starting up and a reduction in management choice for landlords. PRS is being destroyed by false ideology of left wing pressure groups and politicians who haven’t an ounce of common sense, only interested in their personal vendettas and not looking at the real, whole picture and what it will mean for tenants they wish to protect from an industry that has proven ……… there isn’t a real problem when you compare 4.5 million rented properties in the UK with 2,757 complaints and 66% of those were supported by TPO. WHERE IS THE PROBLEM !!!!!!!!!!!!!!!!!!!!!! The problem is politicians.
Government and the dictators Shelter and G Rent certainly know how to completely desecrate a sector.
It won’t be just letting agents but all the trades associated with the sector.
The Tories like to say there the party for small businesses what a joke. G Osborne section 24 destroyed hundreds of businesses over night.
The sector has been beaten black and blue in the last 4years.
Most agents won’t survive, the 20/30% knock on their revenue will force them to close. Sad times ahead for some good agents.