Letting agency requesting full months rent to register interest - allowed?

Victor

the world wonders wrote: »

Make the most of your temporary position of power while you can, I can't wait until the rental market swings the other way so that exploiting scumbags like you get what's coming to you.

No insults please. Constructive posts only.

Moderator

djimi

murphaph wrote: »

It obviously isn't complete, or they'd be out of business already.

I think the tide is turning wrt deposits etc. in Ireland as people prepare to rent for the long haul instead of jumping on the property ladder.

In Germany (fabled land of tenant utopia) the tenant has to come up with:
3 months rent deposit for LL
2 x months commission (for agent if agent used by LL, which they usually are)

So, a tenant in Germany moving into a new place will typically be looking at FIVE MONTHS rent.

In Ireland, I believe we'll start seeing LLs demanding 2 months deposits in the future, as it's getting harder for LLs to deal with non-paying or problem tenants. Have already heard of this happening anecdotally.

None of that is in any way relevant to this situation.

These guys are expecting people to hand over the deposit just to get a viewing. Its complete nonsense and completely unnecessary. Someone has posted a link to one of their properties that rents for €1850 a month; do you really think its reasonable to expect someone to hand a letting agent the guts of two grand just to register interest in a property?

murphaph

djimi wrote: »

None of that is in any way relevant to this situation.

Sorry, it wasn't meant to be. Just general musings...

djimi wrote: »

These guys are expecting people to hand over the deposit just to get a viewing. Its complete nonsense and completely unnecessary. Someone has posted a link to one of their properties that rents for €1850 a month; do you really think its reasonable to expect someone to hand a letting agent the guts of two grand just to register interest in a property?

That sounds like a higher end property tbh, so the €1850 possibly isn't such a big deal for prospective tenants as it is for you?

As I've already said, if this policy was the total disaster that some here are making it out to be, then the company using it would presumably have either stopped it by now or folded because of it. It is a private business decision by the company involved and if it works for them and their clients, good luck to them.

My more general point is that I believe that tenants in Ireland will have to get used to handing over more money at the commencement of a tenancy than in the past.

djimi

If they want to try and charge it then more power to them. Im just saying its complete nonsense; just stating an opinion really. If people want to hand them over that much money before they even see the property then more fool them I guess.

Scortho

murphaph wrote: »

I think the days of paying commission should be over with the oul internet but in Germany the agent is alive and well and landlords tend to use them a lot.

It's the same when BUYING a property here: the buyer pays typically a whopping 7% of the purchase price of a place. That's serious dough, given most of them just use the equivalent of daft to find buyers.

Re the 7% do you mean in Germany or Ireland?

K.Flyer

murphaph wrote: »

That sounds like a higher end property tbh,

Looking at the pictures it not particularly higher end. Bedrooms look very small for the price and at 1850 you are paying for being a footstep off Grafton St. Even the BER is not great on it, there is much better value elsewhere.

murphaph

Scortho wrote: »

Re the 7% do you mean in Germany or Ireland?

That's in Germany.

The Big Red Button

dublin lettings wrote: »

Hi There Oeufmerf. I am replying from dublinlettings.com with an explanation of our policy. I hope you will understand our position. Some properties are quite popular such as the one you saw last Sunday. When we have a number of people expressing an interest in renting one property we must inform each person of the policy of the company and like our agent did last Sunday you were told each person is given an opportunity to pay a deposit and provide their references. When more than one person pays a deposit the person with the most suitable application and best references will be offered the property. The other person will be promptly repaid their deposit. You will see that this is what happened. The reason for this policy is no matter what people tell us it very often does not work out that way for example 2 or 3 people could tell us they want a property but none have any intention of taking it. Another person may pay a deposit but have terrible references. Remember we are at this stage trying to secure the best possible tenant for our client (the landlord). at no stage are you forced to do anything against your will. We clearly set out our policy in writing to you before you have a chance to make any decision. you can choose not to pay anything and supply your references also and take the chance that it may be taken by another potential tenant.

Well, what I've taken from this thread is to always avoid Dublin Lettings, and never have any dealings with them.

Thanks for the warning OP!

Oeufmerf

I've just seen the reply from Dublin Lettings! Outrageous....

I just cannot believe that there is a even an attempt to justify what is clearly an indefensible business practice. Fair enough you get time wasters, I don't disagree with the need for a booking deposit, it stands to reason and when used responsibly supports genuine would-be renters should as myself. My problem is the fact that you require an ENTIRE month's rent. It is very dodgy.

Hypothetically, given the busy rental market you refer to, you could have booking deposits from numerous individuals. It gives a whole new meaning to 'funds resting in accounts'.

I had taken some advice from the PSRA (which, of course, was not to hand over any money under this circumstance). They had asked me to send them an email to give them details to investigate this further. I had completely forgotten to do that but thankfully having come back to this thread I will now lodge a query with the PSRA.

I am still looking for a property in Dublin but am choosing agents quite carefully now too!

Gatling

Strangely enough had a similar experience when looking at houses and apartments to rent a few years ago ,went to see one particular house that was in bits ,after viewing with 2 others couples we were all informed that there was a 500e non refundable holding deposit on the house on top of the usual deposit and rent up front ,for 2 weeks after the viewing the agent would ring both our phones several times a day with offers to reduce the non refundable holding deposit, we found out later certain companies do this as standard practice

P_1

I always thought the holding deposit was for the agent to take the property off the market once you said yes. It usually gets taken off the wedge you have to pay when you sign the lease.

Now maybe DL work the same way but they just explained it arseways.

Rasmus

P_1 wrote: »

I always thought the holding deposit was for the agent to take the property off the market once you said yes. It usually gets taken off the wedge you have to pay when you sign the lease.

Now maybe DL work the same way but they just explained it arseways.

This may work for the person who actually signs the lease, but what about all the other interested parties who hand over money too? In no way, no matter how they explain it, is this acceptable.

P_1

Rasmus wrote: »

This may work for the person who actually signs the lease, but what about all the other interested parties who hand over money too? In no way, no matter how they explain it, is this acceptable.

If I'm reading it correctly one of 3 things happen

1 - Person says they want to rent and signs the lease, holding deposit is refunded by them not having that already included in the sum they hand over for deposit and 1st month rent.
2 - Person says they want to rent but landlord doesn't want to rent to them, holding deposit is refunded to them
3 - Person says they want to rent but then pulls out, holding deposit is not refunded.

I guess its a deterrent to people agreeing to rent and then deciding not to actually sign the lease. It's actually a fairly common concept in most contract like deals but it usually only tends to happen in B2B deals

Holek

My question would be, did somebody actually rent a house/flat successfully with Dublin Lettings?

And if you tried to, and haven't been chosen, can you tell us if everything went fine with returning the deposit?

Joe Hart

Holek wrote: »

My question would be, did somebody actually rent a house/flat successfully with Dublin Lettings?

And if you tried to, and haven't been chosen, can you tell us if everything went fine with returning the deposit?

Workmate dealt wtih them, lost out on a place and said it was an absolute nightmare to get the deposit back. Ended up wasting hours chasing it up.

Holek

Now that I'm also done with Dublin Lettings I can tell my side of the story:

First of all, this firstly-pay-deposit thing sounded really fishy, but after doing some research on Dublin Lettings (including that small post above) I decided to go with them.

I paid my deposit and sent my references. Everything checks out, and one day they call me on midday, saying the landlord would like to meet me.

The same day in the evening, I get a call from Managing Director of DublinLettings telling me, that landlord wants to cancel the appointment with a reason that he "feels I would not be able to afford the rent", and wants them to pay back the deposit. (To be fair, they tried to negotiate with him, so they did what they could)

Deposit return went okay, I didn't have to wait forever (like @Joe Hart's workmate), and I'm happy to get my money back.

Would I recommend Dublin Lettings to anyone? ...Maybe. As much as they hold on to their word, I still can't get used to the idea that I have to pay the deposit before being chosen, and the idea that my money is frozen somewhere there.

In the end, I lost a whole week for my house hunt, because Dublin Lettings held on to my deposit, and then the landlord acted like a douche. I don't care about the money that much, as I do about time. I know money will come back at some point, but time won't.

To be fair, at all times they were honest with me 100%, acted promptly and professionally. It was all landlord's fault.

So, if you can wait with them having your deposit money, and you find some really good offer from them, you can go with them. I know I will not use their services any time soon, because of time constraints.

Rasmus

Holek wrote: »

To be fair, at all times they were honest with me 100%, acted promptly and professionally. It was all landlord's fault.

It wasn't LL fault though - are you saying this because he cancelled the appointment? End of the day, you didn't have your money for a week, during which time you were not in a position to give that deposit to someone else, should you have seen a place you liked. It is complete BS what Dublin Lettings do, and there are plenty of other outfits to choose from. I still don't understand how this is not against any rules, or even illegal.

the world wonders

Holek wrote: »

So you paid the deposit up front to show you were serious and they still wasted your time and messed you around? What a bunch of clowns.

Scortho

I wonder what would happen to people who give deposits so that they can be considered and dublin lettings went into liquidation? would the person who gave the deposit to show they were serious be able to get their deposit back or would they go down as unsecured creditors?
To me it looks a bit like a ponzi scheme...taking in deposit from person B, to give the deposit to unsuccessful candidate A and then if person B is unsuccessful, gets his deposit back when person C comes along...





Note this is not suggesting that Dublin lettings are insolvent, are about to go into liquidation or operating a ponzi scheme. I just don't like the sound of it all.

The_Conductor

murphaph wrote: »

It obviously isn't complete, or they'd be out of business already.

I think the tide is turning wrt deposits etc. in Ireland as people prepare to rent for the long haul instead of jumping on the property ladder.

In Germany (fabled land of tenant utopia) the tenant has to come up with:
3 months rent deposit for LL
2 x months commission (for agent if agent used by LL, which they usually are)

So, a tenant in Germany moving into a new place will typically be looking at FIVE MONTHS rent.

In Ireland, I believe we'll start seeing LLs demanding 2 months deposits in the future, as it's getting harder for LLs to deal with non-paying or problem tenants. Have already heard of this happening anecdotally.

A hybrid German / Australian model- but with the 3 months security deposit held in escrow, and fast track evictions for non-compliant tenants- would be an ideal route to go.........

I also think that tenants should pay for the cost of agents- as per elsewhere. I don't really understand how/why the Irish market has developed in the way it does- where landlords are treated like Dickensian baddies, and tenants, regardless of how destructive they are, are afforded the benefit of the doubt.

I'd also advocate the complete removal of mortgage interest as an allowable expense for landlords btw- and allow this affect property prices accordingly. If a property isn't a reasonable investment- then don't invest in it.

Honey and Milk

smccarrick wrote: »

I'd also advocate the complete removal of mortgage interest as an allowable expense for landlords btw- .

That was done for three years after the bacon Report in 1998. Rents doubled!

UDP

smccarrick wrote: »

I also think that tenants should pay for the cost of agents- as per elsewhere.

I strongly disagree with this practice. One or two places in germany tried to get me to pay this when apartment hunting but I wouldn't pay it so took different apartments that didn't have this fee/didn't use agents. My reasons why I disagree are the agent is working for the landlord not me (I didn't hire him/her) so they never have my best interests at heart - in fact they work like salespeople covering flaws with bs to close the deal i.e. Not pointing out the pros and cons of each apartment for me so that I can make an informed decision since I can't really back out after a month without substantial loses. Also the agent is not exactly spending time going around searching for apartments for me or saving me any time - it is all for the benefit of the landlord. Am I supposed to pay this agent for showing other people the apartment that I end up choosing to rent? It's not my fault that the landlord chose not to do it themselves - it is their business after all not a free no hassle money maker. If the landlord chose to go the lazy route then the cost should come out of their profits.

ladysarah

under no circumstances should agents take a deposit until they are sure they are giving the couple the properyy. I sm an agent and when i let the apartment i only take a 400 euro holding deposit until the keys are handed over but i would never take money unless I was sure I was giving them the property. i do not agree with agent's charging tenants either.

jam_mac_jam

You have no protection if you do this. If Dublin lettings go bust in the morning your money is gone. This is not normal and I would look elsewhere.

Kosseegan

jam_mac_jam wrote: »

You have no protection if you do this. If Dublin lettings go bust in the morning your money is gone.

What about their bond?

kippy

gaius c wrote: »

Plenty of empty apartments about the place...

Apartments that aren't in demand for one reason or another by the looks of it.
(Too small, too much sound, poor build quality etc etc)

As for the OP, I've not heard of this practice before but I suppose when there is a lot of demand for the right places landlords want to reduce the amount of those that aren't 100% serious about their place.

The_Conductor

Kosseegan wrote: »

What about their bond?

You're an unsecured creditor- look at all the threads here about properties gone into NAMA etc- you're an unsecured creditor, should that happen. Vis-a-vis actual tenants- the advice is- if the landlord goes into liquidation- to negotiate with the liquidator to use the deposit as the last month's rent. In the case of where you're not yet a tenant- your deposit becomes a hell of a lot more tenuous- you have no comeback, if they go into liquidation. What about their bond?

Kosseegan

smccarrick wrote: »

You're an unsecured creditor- look at all the threads here about properties gone into NAMA etc- you're an unsecured creditor, should that happen. Vis-a-vis actual tenants- the advice is- if the landlord goes into liquidation- to negotiate with the liquidator to use the deposit as the last month's rent. In the case of where you're not yet a tenant- your deposit becomes a hell of a lot more tenuous- you have no comeback, if they go into liquidation. What about their bond?

Estate agents are required to have a bond in place for the protectuion of clients. It is a much different situation regarding properties gone into NAMA. Nobody posting here has yeat applied to the PRTB for a deposit back from NAMA and been refused. Unless the landlord is a limited company ( and the vast majority are not) he cannot go into liquidation. Receivers are appointed by the banks but nobody has yet reported complaining to the PRTB. Receivers are personally liable in any case so there is nop secured creditor issue.