Question: 

I have engaged a letting agent to manage a large portfolio of property on my behalf. Can the agent charge the tenants their management fees ? 

Response: 

Landlords frequently employ letting agents to let and, in some cases, manage their properties. Letting agents are required under law to have a licence and Landlords should avoid dealing with unlicensed agents as you may have little recourse if things go wrong.

Our understanding is that it is not legal for agents to charge tenants fees.

Under Section 90 of the Property Services (Regulation) Act 2011 it is not legal to charge tenants fees.

90.—(1) Subject to subsection (2), any provision (whether expressor implied) in an agreement in respect of the sale or letting of land whereby the purchaser or tenant, as the case may be, is required to pay or otherwise bear the cost of the licensee’s fees or expenses in respect of the sale or letting, as the case may be, shall be void, and any moneys paid pursuant to such a provision shall be recoverable as a simple contract debt in a court of competent jurisdiction.

(2) Nothing in subsection (1) shall affect the liability of a person to pay fees or expenses to a licensee in respect of the acquisition of any land where the licensee has been retained by the person to acquire such land and does not also act, in respect of such acquisition, on behalf of the person from whom the land is acquired.

So from reading the relevant sections in the Property Services (Regulation) Act 2011 charging a tenant management fee/ fees would be illegal.

 

Need More Information – Speak To The Team At IPOA  01-8276000