One online estate agent has revealed a new way for it to charge landlords – this may help to cancel out some of its losses stemming from the tenant fees ban due to come into force in June 2019.
When the ban on the fees that tenants pay was announced, landlords were left wondering if they’d have to pick up the bill.
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While tenants will no longer have to pay these additional costs, the services that letting agents have been charging them for, such as carrying out an inventory or referencing, still need to be covered.
It has been unclear, until now, if landlords would be charged for these services and, if so, how much of an extra financial burden would be placed on them.
But the question has now been answered by one online estate agent.
Monthly subscription model
The agent, MakeUrMove, will charge landlords £12 a month to cover services including tenant referencing, rent collection, and advertising on property websites Rightmove and Zoopla.
The £12-a-month fee adds up to an annual bill of £144, which the agent says is less than the average £200 a year that its landlords are charged currently.
It can also be compared to the £96 that MakeUrMove previously charged tenants for referencing alone.
The agent said it was able to keep landlords’ costs low due to improved technology and automation, and claims the new model will make the letting process smoother for landlords.
MakeUrMove will also offer optional bolt-ons for an extra charge, including guaranteed rent for up to six months, and gas safety certificates.
Ongoing landlord support
Alexandra Morris, Managing Director at MakeUrMove, explained: “Our new subscription package costs landlords less than the average previous spend, and contains everything a landlord needs from a letting agent.
“We have spent months looking at how to achieve this, and have also acted on the assumption that there will be longer tenancies in future, and that landlords will need ongoing support rather than one-off services.
“The Tenant Fees Bill is going to affect the whole property industry. The most innovative agents will look to technology to reduce costs.
“We’re at the forefront of this as the first agent to come out and support the tenant fees ban.”
The agent is also offering a pay-as-you-go package to landlords at a one-off cost of £96, which will include tenancy documents and deposit lodging, rent collection for 12 months, and advertising on the major property websites.
Tenant Fees Bill
Due to come into force on 1 June 2019, the ban on tenant fees will mean tenants will only be required to pay their rent and deposit.
While most other types of fee will be prohibited, landlords will still be able to charge fees to replace lost keys or for late rent.
The third reading of the Tenant Fee Bill was scheduled to take place in the House of Lords on 15 January 2019. The next steps are for any amendments to be considered before it’s passed into law.
Let us know your thoughts on the proposed subscription model in the comments.