Is estate agent greed hampering tenants' rights?

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Greedy estate agents have been blamed for blocking the introduction of longer-term private rental contracts with demands for annual renewal fees.

Campaigners for tenants' right have long called for a shake-up of assured short-hold tenancy (AST) agreements to allow private tenants,which number nine million in the UK, to secure a home for three years or even longer, mimicking the system operated in other parts of Europe.

Landlords have long been blamed for refusing to write longer contracts, leaving tenants living with little stability, because they want the freedom to increase the rent and the opportunity to undertake 'revenge evictions'. Mortgage lenders have also been blamed for placing onerous rules on landlords who take out buy-to-let mortgages to purchase a rental property.

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Agents 'preventing market from evolving'

Many lenders' terms and condition state the longest period an AST is allowed to cover is just 12 months, meaning a landlord could not offer a longer tenancy even if they want to as it would breach the terms of their mortgage.

However, while there are obviously rogue landlords and uncompromising mortgage lenders, Dan Wilson Craw of Generation Rent said estate agents were the ones preventing the rental market from evolving.

Lettings agencies charge landlords for finding a tenant and the work involved, then charge the tenant when they move in.

However, the fees don't stop there as there as landlords and sometimes tenants are also charged a fee for renewing contracts each year with lettings agencies using the end of the contract term to negotiate up a rent, which will bag them more commission in the forthcoming year.

'It is difficult for a tenant to get a three year tenancy because while you have a landlord that likes stability [of rental income] and a tenant who wants stability [of knowing they will not lose their home], the letting agent will want an annual renewal process where they charge a fee and can raise the rent,' said Wilson Craw.

He said estate agents were the 'stumbling block' to a fairer rental market.

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Improving conditions

Other parts of the rental market are improving. Earlier this month, MPs backed a private member's bill that would make it illegal to evict tenants who make complaints about broken boilers and leaking roofs. These types of eviction are known as 'revenge evictions' and means a landlord throws tenants out and gets new ones in rather than fixing the problems in the property.

Earlier this year, Labour leader Ed Miliband made three-year tenancies for those in the private rented sector a key part of his campaign. He wants to make three-year tenancies the norm in the UK and place a limit on the amount rent can increase each year in order to address the cost of living crisis.

Brian Murphy, head of lending at Mortgage Advice Bureau, said there was also good news in mortgage lending as he was seeing an increased appetite for lenders to allow landlords to write longer-term AST.

'The government is encouraging longer term tenure [but] lenders have [typically] allowed six month or 12 month ASTs,' he said. '[Specialist buy-to-let lender] Mortgage Works has changed the terms of its mortgages to allow three-year tenancies and others will follow suit.'

Nationwide also allows landlords to write longer-term tenancies under its buy-to-let mortgage terms.

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Is estate agent greed hampering tenants' rights?

Audley House, a Grade II Listed Georgian property, is on the rental market for an astonishing £780,000 a year - or £15,000 a week, making one of the UK's most expensive rental properties.

It is estimated the bills will come to a whopping £125,000 a year, on top of the rent.

The six-storey mansion is spread out over 8,346 sq/ft and is worth approximately £35million. 

However, you need not worry about walking up all those flights of stairs as there is a private passenger lift with access to all floors.

The luxurious property is set in the heart of Mayfair.

Comfort cooling, state-of-the-art security and audio-entertainment technology are incorporated throughout the Mayfair mansion. 

The property features five VIP bedrooms suites.

Each of the luxurious bedrooms are decorated in different coloured decor.

At 1,500 sq ft the master bedroom is bigger than the average British home.

The mansion also features four reception rooms,a family kitchen, a gym and private walled gardens.  

The stunning six-storey property comes fully furnished with luxurious furniture, fixtures and fittings and is ready for tenants to move in.

Like all rental properties, interested tenants will be asked to hand over a six week deposit and the first month's rent before they move in. 

The property comes with a five year contract meaning tenants will end up handing over £3.9million to the landlord.

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