Agents' Fees under Fire; Landlords Will Save on Fees If a Government Watchdog Gets Its Way. David Spittles Looks at Agents' Repeat Commissions HOMES & PROPERTY

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Byline: DAVID SPITTLES

ESTATE agents who charge landlords a repeat fee when tenants renew their contract and stay in the property are "open to challenge", according to the Office of Fair Trading (OFT). Repeat commissions are a sore point for many landlords.

Agents typically charge 10 per cent for finding a tenant, drafting the contract and collecting rent. Full management costs up to 17.5 per cent.

While these charges may be reasonable for the initial contract, landlords say they are not justified for an ongoing tenancy where the tenant is in situ and agents merely have to update the paperwork.

"We have counsel's opinion that this is an unfair contract term," says an OFT spokeswoman.

Last week, the OFT released a damning report on the rogue practices of estate agents. The thorny issue of repeat commissions was not mentioned in that report, but it could come as an even bigger bombshell to the industry.

At stake are millions of pounds of commissions. The OFT says any challenge will have to be tested in the courts by an individual landlord. …