Letting fees. What the hell? [Archive]

tri boy

1st June 2009, 20:26

This is the first time I've had to deal with a rental via a registered real estate company, and besides them not really knowing much about the property in general, they also skinned me for $400 under the premise of "letting fee".
What the hell is it?
It's like walking into your local shop to buy a loaf of bread.
Paying for the bread.
And leaving without the bread.

When I did a bit of online research, all I came up with is that is a fee that REINZ registered agents can charge.
Must say I have always disliked real estate agents in general. (bought and sold property before, and I seem to attract the greasy smarmy ones).
This fee has them right down the bottom of my list now.
Can anyone enlighten me as to what the "fee" is for. (probably for comb overs and bad ties).

Mully

1st June 2009, 21:12

What it's for??

Because they can.

Mom

1st June 2009, 21:17

Can anyone enlighten me as to what the "fee" is for. (probably for comb overs and bad ties).

I will do my best, I have never had a comb over and only wear ties to fancy dress parties so here goes...

As you pointed out a letting fee can only be charged by a licensed REINZ agent. While I do tend to agree that it is an unfair cost to a tenant the fact is historically that is what has happened so therefore it happens. Personally I think the fee should be more fairly divided between the owner and the tenant.

In my time in the business my letting fees covered my expenses associated with letting the property. Advertising was part of it, credit and reference checks another part of it. Commissions paid to my agents was another part of it. Then again I had to pay rent for my office, power, telephone etc. I am sure I could bore you to tears here really.

There was no money made from letting fees, my income came from the commission I charged my owner clients to look after their properties. Infact I used to often times not charge a letting fee to ensure a paying tenant in my managed property, made for a happy tenant and a happy owner. My agents were not unhappy either, I used to fund their fee for letting the property out of my ever depleting income due to not charging tenants letting fees :D

MattRSK

1st June 2009, 21:18

CookMySock

1st June 2009, 21:23

Tell them nar I'm not paying that.

Steve

Mom

1st June 2009, 21:33

Yeah and the other thing that annoys me is when you request something urgent to be fixed. Let's say you have no working oven! and it takes them six months to get it fixed. Oh and recently our hot water cylinder is leaking, still no word on when that will get fixed! (different cities different real estate companies).

Real estate agents are the most useless people on the planet. I can't for the life of me see why they are needed.

NO see I will disgree here. Some property managers are the pits and should not be legally allowed to continue to do their job. I cant tell where you live at the moment, but there is no way you should have to put up with a leaking hotwater cylinder, let alone wait 6 months to get your oven fixed, that is totally unacceptable!

Sit down right now and write a letter to the person that manages your property. Head it up 10 day notice to remedy fault. Clearly state that despite informing them that your hotwater cylinder is leaking (potentially causing damage to the house) it has not been fixed. As the tenant your responsibility is to immediately notify the owner, or their agent of any fault, which you have done. Then say you expect the leak to be repaired within 10 days of the receipt of this notice. Sign it and deliver it to the agent.

By law (and this is dumb), you have to allow 4 working days notice for delivery, 2 days if you hand deliver it. Potentailly you will have to wait 14 working days to get your hotwater cylinder repaired if they are stupid enough to not sit up and fix it immediately. If they dont fix it within that time, ring 0800 tenancy and get an application to the Tenancy Tribunal. To make an application will cost you $20? Make sure you claim for the water that is dripping away (if you pay for water that is), for electricity bills paid to heat the water you have not used because it has dripped away, and a sizeable amount for inconvenience :blip:

I hate people that charge for a service and dont deliver.

MattRSK

1st June 2009, 21:40

NO see I will disgree here. Some property managers are the pits and should not be legally allowed to continue to do their job. I cant tell where you live at the moment, but there is no way you should have to put up with a leaking hotwater cylinder, let alone wait 6 months to get your oven fixed, that is totally unacceptable!

Sit down right now and write a letter to the person that manages your property. Head it up 10 day notice to remedy fault. Clearly state that despite informing them that your hotwater cylinder is leaking (potentially causing damage to the house) it has not been fixed. As the tenant your responsibility is to immediately notify the owner, or their agent of any fault, which you have done. Then say you expect the leak to be repaired within 10 days of the receipt of this notice. Sign it and deliver it to the agent.

By law (and this is dumb), you have to allow 4 working days notice for delivery, 2 days if you hand deliver it. Potentailly you will have to wait 14 working days to get your hotwater cylinder repaired if they are stupid enough to not sit up and fix it immediately. If they dont fix it within that time, ring 0800 tenancy and get an application to the Tenancy Tribunal. To make an application will cost you $20? Make sure you claim for the water that is dripping away (if you pay for water that is), for electricity bills paid to heat the water you have not used because it has dripped away, and a sizeable amount for inconvenience :blip:

I hate people that charge for a service and dont deliver.

Yeah I know the process, went through it all with the oven issue. It was crazy, doing all that takes so much time and then the agent just waits all that out before fixing at the last minute.

Thanks for your reply though, I imagine there are some bloody good agents out there that wouldn't stand for that eh.

tri boy

1st June 2009, 21:41

Thanks for the info Mom:niceone:
DB, I can't not pay it:doh: Already have.
If the property manager does a good job, then fair enough I guess, but so far they have proved a bit, err, useless.
Even counting the bond, ($1050 in $20 notes), she miss counted by $400.
Then said I owed them $400 more:Oi:
Count again lady:spanking:
Oh, yes, thats correct.:o
No apology etc.
Then tried to tell me how I needed to keep the place spick n span.
For feck sake lady. Wait till the first inspection. (kanny is the best home body/nester I've ever known)
Seems my 4hundy is now part of her morning tea fund:blank:

steve_t

1st June 2009, 22:19

Next time, you should try to negotiate on the letting fee. The only problem with doing so is you have to be prepared to walk away... and they know that you're keen to get into a place ASAP... It's opportunistic of them and they'll keep doing it as long as people keep paying it :spanking:

Bass

2nd June 2009, 12:22

Yeah I know the process, went through it all with the oven issue. It was crazy, doing all that takes so much time and then the agent just waits all that out before fixing at the last minute.

Thanks for your reply though, I imagine there are some bloody good agents out there that wouldn't stand for that eh.

You can make an application to the tenancy tribunal as soon as you have delivered the 10 day notice to remedy. Yes it will cost you money and you will lose the money if the defect is remedied within the 10 days, but it really keeps the pressure on the other party.
I speak from experience.

dino3310

2nd June 2009, 13:06

used to be the letting fee was the same as a weeks rent.

shit was gonna suggest my pad but the landlord had someone lined up.

Tell the realestate lady to remove the noxious weeds around the place to or i'll send her a letter from biosecurity:laugh:

take a shit load of photos to mate so they dont try to ping you for already worn stuff when you move on.

tri boy

2nd June 2009, 19:36

Mom

2nd June 2009, 19:52

Buggered if I'm gunna be around when that lot are boozing, and thrusting battery operated devices about.:crazy:

Absolute pussy! Fraidy cat of the highest order :D

bogan

2nd June 2009, 20:17

yeh its pretty shit, but most flats are controlled by these fuckers now, specially in student citys where you have to pay a letting fee damn near every year!
Extremely unhappy with our current tenancy agency/landlord, got broken into 4 times in last 6 months, theyve done the absolute minimum to legally be able to keep us here (fixed term tenancy contract), took them to tribunal under hardship clause or summat cos we are pretty sure this thieving fuck is gonna come back, but they sided with them and we have to stay. Seems pretty unethical to make us stay (to me and many other landlord i know) but i spose some people only care about money. Moral of the story, dont get a flat from L.J.Hoooker palmerston, btw they have also been very rude to us from the start and even suggested its our student lifestyle that was causing us to get robbed. anyway, thats my rant for the day

chanceyy

2nd June 2009, 20:25

Mom

2nd June 2009, 20:27

You can make an application to the tenancy tribunal as soon as you have delivered the 10 day notice to remedy. Yes it will cost you money and you will lose the money if the defect is remedied within the 10 days, but it really keeps the pressure on the other party.
I speak from experience.

I agree! Mind you, you should never be placed in that position in the first place, but there are remedies available to you under law. In my experience of property managing, the legislation is slanted towards the tenant though the arguement is, it is balanced. Tribunal is fairly cut and dried about these things, be prepared and win your case. I never lost one.

I have heard some horror stories of property managers and landlords being taken to task in tribunal in a big way, by a smart and organised tenant in a genuine case of the manager/owner should have been doing their job properly and wasn't. Dont put up with shit, deal with it. I am happy to help anyone tenant/owner to negotiate their way through tribunal processes.

dino3310

5th June 2009, 22:49

Wooly night shade is no match for this little noxious weed.:laugh:
4 bedrooms, fecking big lounge, spa bath, good sized garage, and not in sububia:Punk:. Kanny is even organising "adult toys" parties for her workmates there:shit:
Buggered if I'm gunna be around when that lot are boozing, and thrusting battery operated devices about.:crazy:

spa bath,garage with mechanic, adult toy chick parties :chase: :eek: :spanking: :devil2:
fark mate do want a border sounds like utopia to me:msn-wink:

boman

6th June 2009, 08:19

READ ALL MATERIAL SENT TO YOU BY THE AGENT, THOROUGHLY. Do not assume nothing. They stitched some people I know into a 5 year lease by discussing one lot of paperwork with them, and then sending out a long term agreement. They didnot read sent material and signed. They only found out when they went to leave after 2 years. The cost of living had driven them to move closer to work.

GOONR

6th June 2009, 17:55

NO see I will disgree here. Some property managers are the pits and should not be legally allowed to continue to do their job. I cant tell where you live at the moment, but there is no way you should have to put up with a leaking hotwater cylinder, let alone wait 6 months to get your oven fixed, that is totally unacceptable!

Sit down right now and write a letter to the person that manages your property. Head it up 10 day notice to remedy fault. Clearly state that despite informing them that your hotwater cylinder is leaking (potentially causing damage to the house) it has not been fixed. As the tenant your responsibility is to immediately notify the owner, or their agent of any fault, which you have done. Then say you expect the leak to be repaired within 10 days of the receipt of this notice. Sign it and deliver it to the agent.

By law (and this is dumb), you have to allow 4 working days notice for delivery, 2 days if you hand deliver it. Potentailly you will have to wait 14 working days to get your hotwater cylinder repaired if they are stupid enough to not sit up and fix it immediately. If they dont fix it within that time, ring 0800 tenancy and get an application to the Tenancy Tribunal. To make an application will cost you $20? Make sure you claim for the water that is dripping away (if you pay for water that is), for electricity bills paid to heat the water you have not used because it has dripped away, and a sizeable amount for inconvenience :blip:

I hate people that charge for a service and dont deliver.

Great post Mom.

I've been having a few hassles with the rental company that I have to deal with, only small stuff. I have asked them to fix a few things, they forget, I remind them, they forget.....

Now I am armed with knowledge...:woohoo: Cheers.

FROSTY

6th June 2009, 18:22

you think as tenant you have worries.? try being the landlord dealing with dodgy agents. ARGGG
property inspection charges for inspections not done. Deductions from rent for emergency repairs to items that were repaired by the tenant parts supplied my moi

GOONR

6th June 2009, 18:58

you think as tenant you have worries.? try being the landlord dealing with dodgy agents. ARGGG
property inspection charges for inspections not done.

I know about inspections not done. I had an inspection due, letter turned up telling me that the agent would be round on such and such date... no show. I really don't know where some of these agents get off, the ones that I have had to deal with have been useless. I'm not saying that they are all like this, just the ones I've dealt with.

tri boy

6th June 2009, 19:59

spa bath,garage with mechanic, adult toy chick parties :chase: :eek: :spanking: :devil2:
fark mate do want a border sounds like utopia to me:msn-wink:
Take a number and stand in line:whistle:
(Got a txt message from Jamie, in Papua New Guinea aka mountlocal1. He is heading back for 4weeks in Sept, and he has dibs on one of the rooms for a month).
Actually ,this is the first post since me n kanny have been in the house. The broadband is way better here than the old place, (faster), and besides one lounge ceiling light trying to burn the roof out due to melted wiring, (circuit breaker works well:crazy:), the rest is pretty good.
Will get the property agent onto a sparky on Monday, and start taking pics of the inside and outside also.
Pop around on Sunday, theirs some wooly stuff that needs your professional opinion.:whistle:

Sollyboy

6th June 2009, 21:04

BMWST?

6th June 2009, 21:30

pretty sure a landlord would want the hot water cyclinder fixed pretty smart...the floor will be rotting!If its not a loose pipe the cylinder itself will have had it,and will have to be replaced.

steve_t

6th June 2009, 21:42

shouldnt it be the landlord that pays the letting fee , after all its a service he request from a realestate agent and he can rent his house out without an agent, it just seems odd that a lazy landlord can make someone else pay?

The landlord probably ALSO pays a letting success fee along with the weekly percentage of the rent. I wish I'd become a property manager :whistle:

MattRSK

6th June 2009, 22:14

pretty sure a landlord would want the hot water cyclinder fixed pretty smart...the floor will be rotting!If its not a loose pipe the cylinder itself will have had it,and will have to be replaced.

Guess I could just take the bucket out from under it and let the floor rot out. I'm sure thats willful damage though.

Lias

6th June 2009, 22:33

Whats missing here is an invite to come around for a KB housewarming for a BBQ and spa lol :-)

popelli

7th June 2009, 07:31

shouldnt it be the landlord that pays the letting fee , after all its a service he request from a realestate agent and he can rent his house out without an agent, it just seems odd that a lazy landlord can make someone else pay?

Somebody has to pay for the services provided and if the landlord pays he will load the rent to cover it so the tenant will pay one way or the other

I have rented properties on and off for the best part of 20 years now

Apart from the capital gain if you have a mortgage there is not a lot of money in it

Repairs, tenant damage, vacancies between tenants whilst you are fixing / claning up the mess left by previous tenants, unpaid rent, bills for unauthorised or ficticious repairs

Tenancy Tribunals are a joke, they always find in favour of the tenant even when they have blatently broken written agreements

Sollyboy

7th June 2009, 10:50

Somebody has to pay for the services provided and if the landlord pays he will load the rent to cover it so the tenant will pay one way or the other

I have rented properties on and off for the best part of 20 years now

Apart from the capital gain if you have a mortgage there is not a lot of money in it

Repairs, tenant damage, vacancies between tenants whilst you are fixing / claning up the mess left by previous tenants, unpaid rent, bills for unauthorised or ficticious repairs

Tenancy Tribunals are a joke, they always find in favour of the tenant even when they have blatently broken written agreements

I know someone has to pay but charging a tennant a letting fee to me is like walking into a dairy and the dairy owner telling you the previous customer took a loaf of bread for free and said to just charge the next customer for it, the landlord in effects is incures a debt for the tennant , if need to be then load it onto the rent which over a year may only be $4 a week which is better than coming up with a $200 plus gst up front, also no gst on rent so if divided between a years rent no gst incur , some peeps here have no sense of fair play

FROSTY

7th June 2009, 12:05

Solly nahh dont think you have it right. If ya wanna comparison its like going into a trave agent and booking a holiday --you know they are clipping the ticket on everything but you pay for the service.

retro asian

7th June 2009, 16:30

popelli

7th June 2009, 18:03

I know someone has to pay but charging a tennant a letting fee to me is like walking into a dairy and the dairy owner telling you the previous customer took a loaf of bread for free and said to just charge the next customer for it, the landlord in effects is incures a debt for the tennant , if need to be then load it onto the rent which over a year may only be $4 a week which is better than coming up with a $200 plus gst up front, also no gst on rent so if divided between a years rent no gst incur , some peeps here have no sense of fair play

Sorry but their is a fatal flaw in your argument, part of the letting fee should include credit checks on the tenant to see if they are actually credit worthy, have tenancy problems in the past etc etc.

If a tenant fails this test obviously there will be no renting out to that tenant if teh prospetcive tenant has not paid up front for tghese checks then who is going to front for costs of the failed credit check ?

In your version of fair play a dodgey tenant can keep running around all the rental agencies until they get "lucky" meanwhile various landlords / agencies get stung for these application fees from a no hoper with a bad credit history

Also if a landlord is to pay for these letting fees up front they may want to recover these charges by way of stitching the tenant up for a minimum term of a year / 2 years tenancy, this is not always in the tenants interest if their situation changes and they wish to move on, I had one tenant who insisted on a 12 month lease, 6 months later they wished to move on, fortunately for them the houise was relet immediately so they didn't have to cough for 6 months rental when they had moved on, unfortunately for them the market rentals had dropped and they had to recompense me for the drop in rental for the remainder of their "lease"

At the end of the day the agency is providing a service to the tenant to find them a suitable house, if you don't like using agencies and paying these fees then don't use them

From the other side of the fence some (read most) agencies are a complete waste of space from a landlords perspective, I had one who could not find me a tenant, (he thought if the house was vacant long enough he would be able to earn a commisssion selling it) one advert in the paper and 20 applicants later I had the best tenant I have ever had, conversely one letter of complaint to the real estate institute and he got his butt kicked in a big way

Mom

7th June 2009, 18:17

The landlord probably ALSO pays a letting success fee along with the weekly percentage of the rent. I wish I'd become a property manager :whistle:

You would be surprised just how much money you can make managing property....if you do it well. If you dont, well you will be lucky to cover expenses. It is a great business, but very fickle. People are reluctant to pay for a service that you offer, because they have been let down so often by other unprofessional people. Meeting objections was my speciality, I never missed with a pitch, then again, I actually delivered on what I said I would. I also gained a reputation with the renting population in my area as being a fair, but firm (read positively feral when required) property manager.

Apart from the capital gain if you have a mortgage there is not a lot of money in it *snip*
..........
*snip* Tenancy Tribunals are a joke, they always find in favour of the tenant even when they have blatently broken written agreements

I am picking you never had the services of a good manager looking after your properties.

I do, and dont agree with your first comment regarding capital gains being the only money you make being a landlord. If you are geared properly you will be making much more than that. I am not just talking about negative gearing here either, I am talking about equity.

If you are smart though, you wont want to be making anything on your property investments, money is better in your pocket than the IRD afterall ;)

As far as Tribunal goes, I am sorry you have not had good experiences with them, yes they do seem to lean to tenants, but if you are armed right, your position prevails.

Sollyboy

7th June 2009, 18:33

Sorry but their is a fatal flaw in your argument, part of the letting fee should include credit checks on the tenant to see if they are actually credit worthy, have tenancy problems in the past etc etc.

From the other side of the fence some (read most) agencies are a complete waste of space from a landlords perspective, I had one who could not find me a tenant, (he thought if the house was vacant long enough he would be able to earn a commisssion selling it) one advert in the paper and 20 applicants later I had the best tenant I have ever had, conversely one letter of complaint to the real estate institute and he got his butt kicked in a big way

For the first bit your arguement is flawed as your saying the person who was succussful in other words the person with the good history and credit pays for the service that filtered out the shit , why they pay they have good credit and are good tenant yet they get penalised.
second the realestate institute disciplines no one really, reinz its a joke

popelli

7th June 2009, 18:44

I am picking you never had the services of a good manager looking after your properties.

I dont agree with your first comment regarding capital gains being the only money you make being a landlord.

If you are smart though, you wont want to be making anything on your property investments, money is better in your pocket than the IRD afterall

As far as Tribunal goes, I am sorry you have not had good experiences with them, yes they do seem to lean to tenants, but if you are armed right, your position prevails.

Agencies - yes had a few bad ones

Money made - yes it can depend entirely upon the gearing that you use

However I still stand by my comment if you are borrowing heavily to invest in rental property then most of the rent will dissappear in servicing the mortgage and the only real cash you will see is when you sell and reap the capital gains

Regards Tribunals - total waste of time in my experience, if they find in the landlords favour, the tenant is either broke or disappears and you never see any money - this happened twice

And in another case they found in favour of the tenant even though there was a clear agreement in writing signed by the tenant whom had not abided by said agreement - this decision even shocked the agency whom refused to place this tenant with any of their properties after this episode

tri boy

7th June 2009, 18:47

Whats missing here is an invite to come around for a KB housewarming for a BBQ and spa lol :-)

It's on the cards mate.
Today involved trailer trips and lugging more boxes.
But the spa bath soaked all the pains away, while I sipped Monteith's as the light faded through the ceiling windows. Fecking bliss.

Mom

7th June 2009, 19:44

Regards Tribunals - total waste of time in my experience, if they find in the landlords favour, the tenant is either broke or disappears and you never see any money - this happened twice

And in another case they found in favour of the tenant even though there was a clear agreement in writing signed by the tenant whom had not abided by said agreement - this decision even shocked the agency whom refused to place this tenant with any of their properties after this episode

Seems you have had a rum deal with them then, I guess I can stand to be corrected :D