The inevitable question of the threat of restrictions on agents fees was recently debated by the Communities & Local Government Select Committee in their recent discussions on industry practices. One of the questions asked was ‘should agents charge tenants for the inventory?’ According to the Association of Independent Inventory Clerks (AIIC), this varies from agent to agent – as in the whole question of fees – there are no set rules. Pat Barber, Chair of the AIIC, shares her view.
There are three accepted parts of the inventory process. The new inventory compilation, the check in and the check out. Each part is vital to a safe let since the inventory is a legal document and important evidence in the event of a tenancy dispute.
Letting agents deal with each of these operations in a variety of confusing ways.Inventory compilation is usually paid for by the landlord since it is in their best interest to have this compiled to protect their investment. This means that at the start of each let, a definitive description of the condition of their property and its contents is available. Check in – usually the tenant pays for this. The check in process is a firm demonstration to the tenant that ‘someone’ is on their side and actively working to ensure fairness and impartiality.
This is the time when the tenant has the opportunity to ensure that they have input in protecting their security deposit, by agreeing the contents of the inventory. Not all agents offer a full check in, but those that do will certainly find that their percentage of end of tenancy disputes will fall rapidly. The check out – can be paid for by either landlord or tenant – sometimes both. I am aware of agents who double their profit by charging both landlord and tenant for one of more parts of the inventory process.
This confusing pricing structure seems to apply to most other fees and commissions that tenants and landlords are faced with – whether the letting agent is a member of a recognised industry organisation or not. No wonder then that at last rumblings are heard about restricting or regulating fees. Complete restriction is clearly not the way forward, this will strangle the lettings sector and cause huge problems for the many good agents running a successful and morally profitable business.
There must be a compromise here. Agents fees should be transparent from the start and clients must know exactly how much is payable and at what stage of the process. Tenants and landlords will not always ask the right questions. They will not be experienced in the sometimes shark-infested waters of the lettings business. It is surely up to those trained to provide the answers and to give out all the information required. This is simple good business practice.
The AIIC is committed to excellence and professionalism in the property inventory process and works hard to ensure that all landlords, tenants and letting agents understand the importance and benefits of professionally completed property inventories.