It was once the case that everything had a price and when you bought it, that was what you paid. Sometimes there may have been a little negotiation involved – when buying a car for instance, where a bit of back-and-forth could earn you some money off and some rubber mats thrown in – but generally, the price tag was the final word.
These days though the price is often only the start, because just as you’re about to hand over your hard-earned money, you discover the fees. Finders’ fees, reservation fees, administration fees, booking fees – they can come as a big surprise and often leave consumers feeling that the odds are stacked against them. While there’s no doubt that there may be additional costs that need to be recovered, it can all feel rather unfair.
While the proliferation of unexpected fees may simply be a symptom of the way our world has changed over recent years, the Chancellor’s autumn statement made it clear that time is running out for one particular form of fee-charging. In a move that has been widely praised (if not quite universally welcomed), the fees charged to tenants by property letting agents are to be banned.
Letting agents certainly provide a legitimate service, helping landlords to fill their properties and, hopefully, helping tenants find properties that suit their needs. But the Chancellor argues that it is the landlords who appoint the agents and therefore they should pay the fees. After all, landlords are free to shop around to find a competitive deal whereas tenants have no such luxury. As things stand, once they find the right property they must pay whatever is asked of them.
According to the English Housing Survey, renters who pay agency fees are charged an average of £223 on top of the other upfront costs such as advance rent and damage deposits. When Shelter carried out a survey in 2012, they found that one in seven private renters who used a letting agent paid over £500 in fees.
At Callisto Wealth Management, we believe forcing tenants to pay these fees has always been unfair. It is a practice that flies in the face of our own commitment to putting clients’ needs first, and we are pleased to see the Chancellor taking this action.
In our business, our clients’ interests always come before our own. Of course, clients understand that we offer a high quality service designed to help them achieve financial freedom, and it’s a service that is worth paying for. But we fundamentally disagree with hidden charges, concealed costs or any other fee which might be sprung on a consumer without their prior knowledge.
Everyone we deal with can be sure that our costs will always be transparent and declared upfront. Some financial planners earn commission from selling particular products, but we will never work that way. For us, putting clients’ interests first means that we shouldn’t be paid by anyone other than them.
Putting clients first also means refusing to rest on our laurels. By keeping an open mind about the way we work, we are able to develop new ways of working that can potentially reduce costs and ensure that our clients keep even more of the return on their investments.
So while the Chancellor’s autumn statement inevitably garnered headlines for all kinds of reasons, we thought it was important that this particular measure should be applauded. In a world in which fees can be an unwelcome surprise, we believe they should at least be borne by those with the freedom to take their business elsewhere.