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Can this landlord increase the rent without using the letting agent?

houseHere is a question to the blog clinic from Christine who is a landlord

I used a letting agent to let my property for a year and draw up the tenancy agreement. The tenants are still there nearly 3 years on paying the same rent and the agent is still charging commission.

I would like to create a new tenancy agreement without using the agent and increase the rent. Can I do this?

It depends firstly on what your agency agreement with your agent says.  So you need to get hold of this and read it.  I am assuming that your agent is not a managing agent.

Your agency agreement should set out the procedure for ending the agreement, although some letting agents insert clauses saying that they are entitled to receive a commission for as long as the tenant remains in the property.

If that is the case, then the next question is, is that clause valid?  Some clauses are void under the Unfair Terms in Consumer Contracts Regulations (assuming you are not a professional landlord in which case the regulations would not apply as you would not be a ‘consumer’).

Clauses which provide for agents to receive a commission indefinitely when they are not managing the property are generally considered unfair although they can be fair if they are for a modest amount and for a limited period of time, say two years.

There was a big case a couple of years ago between the Office of Fair Trading (who police the regulations) and the letting agency Foxtons, and you can see my posts on this here.

It sounds to me, if your agent is not doing any management work and if you have been paying commission for three years, that you should be entitled to end the agreement.  But do see what your agency agreement says before doing anything.

There is guidance for landlords in this position in my Landlord Law site >> here.

(See also the comments area below and >> click here to read our terms of use and comments policy)

Important note. If you are reading an old post, remember that the law may have changed since it was written.

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3 Responses to Can this landlord increase the rent without using the letting agent?

  1. Tessa what makes you think the agent is not in full management. I would assume they are as the story refers to commission still being paid, which to me sounds like on the same original monthly rent.

    If it was purely on a renewal basis I’d have thought Christine would have said so.

    The main points in the Foxton’s case were the burying of the clause and small print, and above all the fact they were doing nothing for the renewal fee they were charging.

    You are quite correct though – the contract will state what the agent is entitled to charge. UCT Regs will then have something to say on whether they can charge it. If they haven’t suggested an increase for three years I’d say that is more than enough grounds for a strong enough argument to make them back off – if they have any sense.

  2. The way the question was worded read, to me, as if no management work was being done. However the answer is qualified.

    It is always difficult to advise where we do not have sight of the written agreement. Distressingly questioners rarely refer to the paperwork, seeming to think that there are general answers ‘out there’ which apply in all situations.

    Unfortunately it is a bit more complex than that …

  3. It seems that the real issue is the common one of the agent’s commission rather than the rent increase, which is not addressed in the post.
    If Christine wants to increase the rent ASAP while sorting out the agent’s issue she can simply follow the s.13 notice procedure.



About the post author:

Tessa Shepperson

Tessa is a lawyer and specialises in creating products and services which help landlords and letting agents learn and understand landlord & tenant law. For example, she runs the Landlord Law website (now in its 14th year) and is a director of Easy Law Training Ltd and Your Law Store. Tessa also sits on the Property Redress Scheme Council. When not working she enjoys reading, cooking and messing around on the computer. You can also find her on Google

The Landlord Law Blog from Tessa Shepperson

Tessa is an English lawyer specialising in residential landlord and tenant law.

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