Stick it! Will Labour’s lettings pledge trip Red Ed?
With less than 24 hours until the polls open, the burning question is ‘who will you vote for?’. In the lettings industry, it may come down to whether personal or professional interests are closest to your heart.
It’s no secret that Labour – spearheaded by Ed Miliband – wants to turn the lettings market on its head. It has taken the side of the tenant, allegedly, promising ‘a better deal for renters’. Labour’s use of language in its propaganda material is provocative to say the least, with the party set on “banning rip off letting fees”.
Ah lettings fees. Labour is trading on the belief that agents work to the ‘stick it’ method – stick it in the window, stick it on Rightmove, stick a board outside. Then the fat cats sit back twiddling their thumbs until desperate tenants unable to buy a property come flooding through the door, alleviating them of a hefty ‘registration and administration fee’ in the process while also fleecing the landlord for a haphazard property management service.
We within the industry know better but what tenant wants to listen to a letting agent bang on about membership fees to ARLA and NALS, training costs, staff overheads, listing fees attached to portals, to name a few expenses. To tenants, letting agents charge handsomely and unjustifiably for merely printing a document.
Also from the Labour website is this gem: “We will make sure that fees charged by letting agents to landlords are transparent so they know what they are paying for.” Ah the transparency card – the buzz word in industries that are trying to lose the ‘grubby’ moniker. What Labour has failed to make transparent, however, is that fees charged to landlords will always find their way back to tenants in the shape of higher rents.
Ah, I can almost hear Ed Miliband cry ‘but we will cap rent rises’. Far from help tenants, however, this pledge will actually prove fatal for them. Just the mere thought of a rent cap is stopping landlords from expanding their buy-to-let portfolios and many will fear their investment will make a loss should a rent cap come into force. Some will sell up altogether, bearing in mind that house prices are at their peak and interest rate rises can’t be too far away. The mass exodus of landlords from the private rental sector will leave limited properties to rent and the very high chance that there will be more tenants than homes available – not very pro renter, is it?
So, come Thursday, will you be telling Red Ed to stick it?
* Simon Duce is the Managing Director of ARPM Outsourced Lettings Support
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