A property management firm is coming up to its first anniversary, saying that it has a multi-million pound rent roll achieved with minimum fees charged to landlords and tenants. It also insists it is not a letting agent, but an alternative.
The Happy Tenant Company, which operates across London and within the M25, revealed its philosophy to Landlord Today after Shelter hit out earlier this month at ‘rip-off’ letting agent fees.
The charity has won a campaign to have them unequivocally outlawed in Scotland and is currently campaigning in England, initially calling for tenants’ and landlords’ evidence.
The Happy Tenant Company provides landlords with a management service for a fixed fee, frozen for two years, and charges no renewal fees and no mark-ups. On a two-bed flat, with a £500 weekly rent, it charges £3,300 for the first year for a lettings and management service.
Tenants have no registration or administration fees to pay, and there are no mark-ups on any property management services such as cleaning, inventory and maintenance issues, which are all provided to tenants at trade prices.
The firm recently conducted a mystery shopping exercise to compare its own charges for a two-bed flat with a rent of £500 per week, with those of Foxtons, Chesterton Humberts, Winkworth, Marsh & Parsons, Hamptons, Richard James & Hunters, Kay and Co, and Savills.
Over a one-year period, the Happy Tenant Company claims to offer landlords savings of £2,004 on Foxtons and Hamptons (the most expensive). Over two years, it claims to offer savings of £5,796 over Hamptons (the most expensive), and £3,300 over Kay and Co (the cheapest). Over a three-year period, it claims to offer savings of £15,756 over Winkworth and Marsh & Parsons, jointly the two most expensive.
It found renewal fees in year three of up to £3,120 – charged by both Chesterton Humberts and Hamptons.
Jonathan Monjack, CEO of the Happy Tenant Company, said: “Our management team includes landlords and tenants.
“We realised some time ago that the exorbitant fees letting agents charge today is simply not acceptable, nor is the level of service tenants say they receive.
“Our business model includes using our size to secure our landlords and tenants the best possible deals on maintenance and third party services – often exclusive to us.”
He added: “We pride ourselves on not being a letting agent. Instead, using our collective property management experience of over a century, we are challenging the monopoly that has been enjoyed by these agents for the past three decades.
“We are putting residential property management at the core of our business, providing landlords with an alternative to letting agents or self management.
“We believe paying a letting agent more than 20% of the annual rental income year after year is unjustified, while paying administration fees on top of this, which according to Shelter can be as high as 600%, is scandalous, and despite this many landlords and tenants receive a substandard service. We formed the Happy Tenant Company as a direct challenge to change this.”
Despite not calling itself an agent, the firm belongs to the National Approved Letting Scheme, Tenancy Deposit Scheme and the Property Ombudsman.
Monjack said: “The excessive fees that agents charge today is now being highlighted due to the vast number of people having no other option but to rent.
“Both landlords and tenants have been paying too much for basic management and maintenance services, and it’s time that this was changed.
“We ensure that our landlords receive a ‘hassle-free landlording service’ at a cost substantially lower than they would otherwise be paying and that our tenants get the best service and quickest response times.”
The Happy Tenant Company’s Landlord Concierge Service sets out its stall as an alternative to using a letting agent or self-management, with the concierges on call 24/7.
Landlords can use the company’s tenant procurement service to market their property, conduct viewings and carry out reference checks to find the right tenants.
www.happytenant.co.uk
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Comments
Thanks for the FANTASTIC post! This information is really good and thanks a lot for sharing it. I’m looking forward desperately for the next post of yours.
Phoenix property management
Recently introduced to Happy Tanant Company and gave them one unit to manage. Not only a first class service, but a very worthwhile saving in fees. Will be transferring other units to them for full management as and when existing management agreements with other agents expire.
I think the 8-12% figure that 'most agents charge' is the letting fee on its own, not including the property management fee? My agents charge me 12% letting fee, plus 8% property management fee, which does mean that I lose 20% of my rental income. If £3,300 is for a lettings and management service, then it's quite a bit cheaper (12.7% v. 20%) than I'm paying.
This story is absolutely awful!
This article is directed at how letting agent fees are a "‘rip-off’ " and that this new company has a solution!
Err hello, I don't exactly work for NASA or anything, but they charge £3,300 fixed fee for a 2 bed flat that is rented at £500/week. That's an annual rental income of £26,000. Now £3,300 of £26,000 is 12.7% fee, which is above average. Most agents charge between 8-12% anyways!
As for "mark-ups", my lettings agency certainly don't mark-up and I don't think good agents do anyways. So again, no solution here.
They have compared this new company to well-established and high-priced agents like Hamptons and Winkworth etc. At the end of the day, don't buy a Ferrari if you can't afford the annual services.
It's great this company is succedding, but to brand the efforts and time of agents as "rip-off" prices, I know that for 10-12% of my rent, I am happy to pay that so I have more time to enjoy my own persoanl life.