Can Letting Agent unilaterally increase commission?

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  • johntel
    started a topic Can Letting Agent unilaterally increase commission?

    Can Letting Agent unilaterally increase commission?

    I rent out a flat through a fully-managed service with a letting agent. My contract with the agent was signed 6 months ago. It is a Lettings Authority, and it incorporates the agents 'Terms of Business' at the time. The contract specifies the commission (10%).
    Last month I received an email from the agent saying they have changed their Terms of Business. The new ToB has a new clause added at the end which basically says the agent is free to change the commission rate at any time.
    This week I received another email, saying they have increased the commission to 12.2% - i.e. an increase of 22%.
    I don't see how they can legally do this - I can't believe they can unilaterally change an existing contract.
    Has anyone else had the same experience?

  • leaseholder64
    replied
    Also active in the last 24 hours: https://forums.landlordzone.co.uk/fo...crease-in-fees

    Leave a comment:


  • leaseholder64
    replied
    Originally posted by BobbosHandle View Post

    is there a way you can highlight these threads on this subject. I have tried searching for them.
    https://forums.landlordzone.co.uk/fo...anagement-fees

    https://forums.landlordzone.co.uk/fo...g-the-landlord

    etc., or more generally google "site:forums.landlordzone.co.uk agent fees increase"

    Leave a comment:


  • BobbosHandle
    replied
    Originally posted by leaseholder64 View Post
    There have been two or there threads discussing this already.
    is there a way you can highlight these threads on this subject. I have tried searching for them.

    Leave a comment:


  • BobbosHandle
    replied
    Hi,

    same problem here. I let a house through Choices ( excuse me while I vomit ). They have increased their commission without even informing me. Not even an email !

    It started at 8% in 2012 and they have put it up to 12%.

    I am in the middle fo querying this with them. I can't find anywhere in the original contract that states they can do this.

    I am considering taking legal advice but would be interested to hear other landlords' experiences first.

    cheers

    Leave a comment:


  • leaseholder64
    replied
    There have been two or there threads discussing this already.

    Someone is going to have to take the cash flow hit that previously fell on the tenants. The agent's way of avoiding it would either be to pass it onto new landlords, as up front fees, or to pass it on to those landlords whose tenants have already taken it, by increasing their commission charge.

    Unless the original contract provides for such changes (utility contracts, bank contracts, etc. usually do), it does seem to be a breach of the contract.

    Arguably, up front fees would be the more market like solution (markets should tend to make charges track costs), but I suspect that many landlords don't have the cash reserves to pay up front fees, or it is more obvious to them how big those fees are.

    Because the market wasn't working before, the tenant fees were probably subsidising the commission. That means that commission may rise even if landlords are charged up front, as a working market will tend to limit the up front fees to a small markup on costs.

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