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Landlords Warned Against Repairs Scam

Wed 24 Jun 2015

In June, the national press reported that a group of property owners were taking a major firm of estate agents to Court, claiming they had been charged hundreds of pounds more for repairs to their properties than the actual cost of the work. Bill Brookes, Chairman of DB Roberts Estate Agents and Property Managers says it was only a matter of time before landlords realised they were being duped.

'We were not really surprised when this 'scandal' hit the national press headlines - only that is had take a long time to happen!

' It seems that London estate agents and letting agents Foxtons have been charging landlords a mark-up of up to 33% on bills for repairs and maintenance of properties they managed - without disclosing it. Some Foxtons landlord clients have now issued proceedings against the agents, one of the high profile claimants being Lynne Faulds-Wood of TV's 'Watchdog' programme.

' Within a few days, our Property Management team began receiving enquiries from local landlords, some being clients of our, but others having their property managed by other agents. They were all anxious to know how they could check if they were also victims of such a scam.

'We were immediately able to re-assure our own clients that our landlord clients pay only what the contractor charges. We ensure that for every job, we send the landlords the contractor's original bill, which we then pay out of rental income as part of our management service. The bill is always made out in the landlord's name, so that they can use the document to prove the expenditure in their annual tax return too.

'We also explain that we don't receive any form of commission payment from our team of Approved Contractors for any of the work they carry out on properties belonging to our landlord clients.'

Bill Brookes urged local landlords to check if they are paying too much for repairs to their rented properties:

'However, some local landlords whose properties are managed by other agents might be surprised if they knew the actual cost of repair bills they receive and the extent to which the agents is making a profit on each job, in addition to their regular management charge. We are aware of other lettings agents in this area who load an additional fee of up to 15% onto the actual cost of repair and maintenance bills. This is not disclosed, and the landlord never sees the original contractor's bill.

 

'We understand that at least one national lettings franchise targets it franchises to generate orders for items of repair and maintenance, all of which have to be carried out by the franchise company's own repair department. The franchisee earns a percentage of the repair bill.'