House sale dilemma (and estate agent rant)
Discussion
We are currently renting out our old house to some good tenants via a letting agent. The tenants have indicated that they would be interested in buying the house in a few months which we are happy with except that a cause in the letting contract states that if the tenant buys the house we have to pay the agent 1.75% commission, or about £5-6K
Now I understand agents have to make money but this is £5K for doing absolutely nothing at all. They have been taking 12.5% management fee (+ VAT) off the rent every month already so why should they get a substantial amount of money for zero effort. They don't have to advertise it, or show people around it... they do nothing. nada. zip. ziltch.
So, how do I best 'renegotiate' this aspect of the agreement?
Now I understand agents have to make money but this is £5K for doing absolutely nothing at all. They have been taking 12.5% management fee (+ VAT) off the rent every month already so why should they get a substantial amount of money for zero effort. They don't have to advertise it, or show people around it... they do nothing. nada. zip. ziltch.
So, how do I best 'renegotiate' this aspect of the agreement?
If I may, you might want to do some googling and research around this news story
http://news.bbc.co.uk/1/hi/business/8144161.stm
You might (might) be able to challenge the terms of your lease. Who is the letting agent/ Are they a member of ARLA?
(First post - be nice)
http://news.bbc.co.uk/1/hi/business/8144161.stm
You might (might) be able to challenge the terms of your lease. Who is the letting agent/ Are they a member of ARLA?
(First post - be nice)
I specifically use an agent that does not have this clause - did you read the contract at outset?
Given that the housing market is on it's ass, good luck with them writing off approx £5/6K.
On a brighter side, there is no harm in asking and agreeing a deal.
You may want to consider end of contract...... they leave eg to a hotel, you sell them the house within a week of them moving out. This assumes that you and they (i.e not agent) have undertaken valuation/mortgage/etc/etc
The only flaw with this approach is that the agent may well sue for loss of £5/6K as their contract terms may say words along the lines of "introduce".
Given that the housing market is on it's ass, good luck with them writing off approx £5/6K.
On a brighter side, there is no harm in asking and agreeing a deal.
You may want to consider end of contract...... they leave eg to a hotel, you sell them the house within a week of them moving out. This assumes that you and they (i.e not agent) have undertaken valuation/mortgage/etc/etc
The only flaw with this approach is that the agent may well sue for loss of £5/6K as their contract terms may say words along the lines of "introduce".
Should have read the contract before signing it. Blunt but true.
There is no harm in trying to negotiate a lower rate and it's certainly worth a crack. Depending on how clued up they are it may prove fruitful or be the start of a load of grief.
To put it into perspective how would you feel if you found out that they were not forefilling their part of the contract and came back with the reasoning 'It's a bit unfair' or ' I didn't read that bit'.
On the flip side it's only what you'd pay to an Estate Agent anyway so there isn't a loss but a lesson learned.
There is no harm in trying to negotiate a lower rate and it's certainly worth a crack. Depending on how clued up they are it may prove fruitful or be the start of a load of grief.
To put it into perspective how would you feel if you found out that they were not forefilling their part of the contract and came back with the reasoning 'It's a bit unfair' or ' I didn't read that bit'.
On the flip side it's only what you'd pay to an Estate Agent anyway so there isn't a loss but a lesson learned.
mk1fan said:
Should have read the contract before signing it. Blunt but true.
Yeah true, but at the time we were expecting to rent the house for a few years while I worked in a different part of the country and then move back to it so we hadn't considered selling. As things worked out we like Bristol more than Slough (suprise suprise) so we are staying in the SW now.dougc said:
What if they leave the house at the end of the rental period, you decide not to get anyone else in so sack off the agent then arrange the sale privately?
+1. Say absolutely nothing to the current agent. Advertise the house privately on one of the numerous portals e.g. Fish4Homes. Point out advert to tenants. End rental contract. Well that's what i would do ..fido said:
dougc said:
What if they leave the house at the end of the rental period, you decide not to get anyone else in so sack off the agent then arrange the sale privately?
+1. Say absolutely nothing to the current agent. Advertise the house privately on one of the numerous portals e.g. Fish4Homes. Point out advert to tenants. End rental contract. Well that's what i would do ..a) you'd likely be subject to purchasing a hip by selling the property in that manner. Set aside the relative merits/demerits of that scheme, it is still likely to cost you a couple of hundred quid. Maybe not a worry.
and (more of a worry) b) if the letting agent you are using a large enough (or canny enough) they may employ tactics to ensure properties they have previously been involved with haven't been subsequently privately sold in order to try to avoid paying fees. Yes, this might sound far fetched or underhand but many use systems like this although not often in this type of situation, I admit (but ours would
).For fear of repeating myself, take a look at the judgement against Foxtons. From memory it was specifically commented that their practise of claiming a fee when a tenant privately purchased a property was illegal. After that speak with ARLA (assuming the letting agent is a member). If all else fails try to negotiate a fee with the letting agent.
Best of luck.
Merlot said:
garycat said:
So, how do I best 'renegotiate' this aspect of the agreement?
Tell the agents that you want to self manage, rent it privately to your existing tenants for 3-6 months.They buy from you privately. Job done.
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