What does a Let Fee cover?

[noisuf]

Hi all,

Just managed to get the property leased out...massive long thread of great help and advice.

Just received my statement and saw the let fee at two weeks that I was expecting but also saw an advertisement fee in addition to it.

What does the let fee cover if it doesn't include the advertising?

I got two sets of advertising fees as I requested the first be pulled down as it was gathering dust (over 1400 hits over 2 months).

 

[Luv2Travel]

You need to check your contract, but my let fees include my advertising. Otherwise, I guess they're saying the let fee is for all their time (and a lot of time that was - their fault!) in finding the tenants.

After the nonsense they put you through I'd be trying to get those advertising fees waived, or tell them you're going elsewhere, which you're close to doing anyhow.

Next time you sign an authority make sure any advertising fees are crossed out and that you are only paying the let fee. Two weeks is also a fair bit, I think most places now (I could be wrong) only charge one week.

 

[noisuf]

Thanks Biggles...I'll go home and check the contract from last year. I will also be pushing to have it waived as he knows what we went through and he knows about Noel Jones.

I didn't sign anything with them for this lease.

 

[Luv2Travel]

I didn't sign anything with them for this lease.

You don't need to sign another one. You sign the authority with the agent when you first appoint them as property manager.

 

[noisuf]

I see........reminding myself to review contract tonight.......and even if it did state advertising fees are extra, I'll push for waiving due to poor experience.

And besides, they can't exactly charge me fully for the let fee considering I helped let my own property with photos, ad, pushing for sat open which allowed the tenant who letted to see it!!!

I'll push from all fronts...will only be happy if they waive ad fee, they can keep the 2 weeks let fee but I will be mindful 1 week is also normal too.

Cheers.

 

[russellpeter]

Hi all,

Just managed to get the property leased out...massive long thread of great help and advice.

Just received my statement and saw the let fee at two weeks that I was expecting but also saw an advertisement fee in addition to it.

What does the let fee cover if it doesn't include the advertising?

I got two sets of advertising fees as I requested the first be pulled down as it was gathering dust (over 1400 hits over 2 months).

I don’t know about Vic but in QLD you are not allowed to charge more than 1 weeks rent for finding a tenant.

check your managing agreement if you can be charged for advertizing. but normally the let fee covers the advertizing.

The more I hear about this agency the more I don’t like.

 

[Rixter]

I don’t know about Vic but in QLD you are not allowed to charge more than 1 weeks rent for finding a tenant.

You guys have it easy over there..in WA standard charges are as follows -

2-3 weeks rent (+gst) for letting fee.

Plus you pay extra for all inspections. Its not included in PM fee.

Plus you pay extra for Property Condition Report. Its not included in PM fee.

Plus you pay extra of end of year financial statement (if required). Its not included in PM fee.

 

[wylie]

I don’t know about Vic but in QLD you are not allowed to charge more than 1 weeks rent for finding a tenant.

Do you have a link to show where this information is coming from.

We have just paid one week's let fee but the agency said they "normally take two weeks", so I am curious to know if it is written somewhere or legislated?

.... or if they were trying to make it sound like they were doing me a favour?

 

[Ozziespur]

When I rang around and interviewed prospective PM's i negotiated the waiver of any letting fee. The competitive nature of the PM market gives the IP holder some room to negotiate the best deal for themselves. I'm kicking myself that I didn't negotiate the management rate fee harder.

Good luck to you. I'm happy I don't own an IP in WA ... wow !

 

[kathryn d]

I would also like to add...
I've been reading many tribunal decisions from the various states..so can't remember exactly which ones..but should a tenant break a lease, and you charge them for the reletting fees, the courts may not allow you to pass that charge onto the tenant.
The courts, in some decisions, stated charging a one or two week reletting fee was excessive, and the fact the LL had to pay the PM, that was a contract between the PM and LL. In the end I think they allowed $88 as the PM agreed it took about 2-4 hours work on their part.

Of course, I would still charge the tenant, and let the courts decide..
Just make it clear in the lease what the charge will be, as long as it doesn't conflict with that state's RTA.

 

[Rixter]

I'm happy I don't own an IP in WA ... wow !

Tell me about it - I just paid out $1105.50 on a letting fee.

I do get a great discounted management fee tho and the letting fee doesnt come round too often due to long tenancy usually.

 

[russellpeter]

Do you have a link to show where this information is coming from.

We have just paid one week's let fee but the agency said they "normally take two weeks", so I am curious to know if it is written somewhere or legislated?

.... or if they were trying to make it sound like they were doing me a favour?

I got the information from the REIQ just gave them a call

i am currently away for the next 5 weeks but when i get back i have the information and will pass it on.

 

[Luv2Travel]

Just out of curiosity, not that it really matters as it's a small amount, but when people pay a letting fee for say one week, does the agent usually add GST on top of the one week's rent, or do they include GST in that one week's rent?

Only asking, because two agents I've used have added GST to it (which is fair enough as it's not income to them) but I'm just signing a new authority at the moment (which is an agent highly recommended to me, and in the short time I have been dealing with them have been very helpful!) and that authority says the one week's rent amount is inclusive of GST. Not something I'd bother to question over with the other agents, but just curious.

 

[russellpeter]

Just out of curiosity, not that it really matters as it's a small amount, but when people pay a letting fee for say one week, does the agent usually add GST on top of the one week's rent, or do they include GST in that one week's rent?

Only asking, because two agents I've used have added GST to it (which is fair enough as it's not income to them) but I'm just signing a new authority at the moment (which is an agent highly recommended to me, and in the short time I have been dealing with them have been very helpful!) and that authority says the one week's rent amount is inclusive of GST. Not something I'd bother to question over with the other agents, but just curious.

everywhere i have worked its been + GST

 

[Luv2Travel]

everywhere i have worked its been + GST

Fair enough, thanks. I can appreciate them adding it, I don't really care one way or the other.

 

[Fudge]

I'm kicking myself that I didn't negotiate the management rate fee harder.

If you have a great PM, paying a little extra in management fees than the next agent down the road is a godsend. You just have to keep trying to find one who gos the extra mile. I have 1 of about 5 PM's who is a GEM, and is well worth the money he charges. (He is actually cheaper than some of my other ones.

F

 

[Luv2Travel]

If you have a great PM, paying a little extra in management fees than the next agent down the road is a godsend. You just have to keep trying to find one who gos the extra mile.

I agree, fee isn't the most important thing. I'd rather pay a little extra for quality service. The landlords on here who go on about squeezing every cent they can from the PM, and then complain when they have a young person on minimum wage handling their property baffles me. After the nonsense I've just experienced from an unexperienced, useless PM, I'd happily pay extra than what I was for more experience and someone who is going to do the job properly.

However, in saying that, if you had read noisuf's recent thread on trying to get his property let, then you'd know that he wasn't getting quality either. So high fees and bad service, now that is a no no!

 

[kathryn d]

I agree, fee isn't the most important thing. I'd rather pay a little extra for quality service. The landlords on here who go on about squeezing every cent they can from the PM, and then complain when they have a young person on minimum wage handling their property baffles me. After the nonsense I've just experienced from an unexperienced, useless PM, I'd happily pay extra than what I was for more experience and someone who is going to do the job properly.

QUOTE]

But who's to say, the PM who provides the "quality service" today, is not replaced next week?
The LL is tied to a contract, and does the LL always know when their PM has been replaced?
So all LL's should be concerned about the price they pay for service received.


...but we don't personally use PMs

 

[jaycee]

kathryn may be shocked, but I agree with her.

A PM firm will tell you what they wil do, and offer a price, if you negotiate it down a little, I doubt that the agency has a process to provide less of a service even though the contract says they will do otherwise.. Nor would the business then change staf and put in place cheasper younger inexperienced staff based on your new negotiated lower price to provide a cheaper service.

I'm not using a PM either.

 

[Luv2Travel]

Who signs a long term contract with a PM company? I've just experienced my first issue with a young PM who I was given when my previous one left. I've been with this company for about 18 months with no issues until now (possibly due to their luck also in that I had a good tenant). They've given me rubbish service the last few months so I'm off.

To find a new PM, I have gone on the recommendation on someone who uses a different company who has a PM who has been around for a while and she is an older lady. She's been so helpful to myself and the person who recommended her to me. The first question I asked her, was not what she charged. The recommendation of her by someone who has been using her for a few years and the fact she's older and more experienced and gave me exactly the information I was looking for is the reason for me choosing her.

If she leaves somewhere down the track and I'm handed a 20 year old who gives me the same issues as the previous company, then I can leave there too. But hopefully, seeing as she's been around a while, as far as I know, and not new into the industry, she'll be around for some time.

Therefore, in my opinion, the fee is not the main reason for selecting an agent. It reminds me of the people who get on here and complain that their accountant didn't do all they should have. When asked who they used, they say they used H & R Block and paid $100. Say no more...