Who gets charged a " annual service fee"?

just looked at a invoice from a PM on one of my regional properties

A annual service fee was charged which is equal to one weeks rent .

Apparently every 12 months they charge this they said , after every 12 months plus if i get a new tenant every year add another weeks rent for that, so ... thats 2 weeks rent a year !

Never seen this """fee"" from my City PM

 

No annual fee ... they want to charge an annual statement fee of something like $30-50 but we opt out as I can add them up myself!

Is that fee in the agreement you signed? That's about another 2% commission if you allocate it over the year ... what commission rate are you paying each month?

 

This Regional agent is charging 7.7 %

 

It must have been agreed to upfront?

 

Yes
But im trying to find out if this is " normal" for Regional NSW agents?

 

No its not. You might get a $33 or so lease renewal fee, but a weeks rent + gst isnt the norm for NSW

I dislike the 1 weeks + gst lease renewal fee from PM's in general and will remove it from the agreement if they put it forward. A lease renewal tick and flick isnt a $275-450 job

 

I agree ... and the "annual service fee" is a new one for me too.

 

ask them to justify it
same time ask other agents and see if that is one of their fees, if they do see what the going rate is and why they charge it. If they don't, change your agent

 

It’s a rubbish fee that PMs are trying to include to prop up their bottom line.

And I don’t pay it in any of my rentals in Vic

 

Can't say I've come across that before as a PM, it's a rather steep fee...!

 

Its a normal fee in SA, but not NSW or VIC where I own

 

Ivr asked some of my agents ti justify certain costs and their excuses are laughable......

Oh we have rent to pay
Geez didnt know other agents were rent free

Oh its not compulsory. Its optional. But our system isnt set up to be able to remove anyone

 

I dont think ive seen this fee in my sa properties.
But if my agent charged it. Id be changing all mine instantly.

I get charged 2 weeks for a new lease. 1 week for a renewal and 8.8% with multiple ips.
Plus their tradies are so overpriced its not funny.
In fact i tell them to get a quote for a job. And i tell them upfront. That i wont be using them anyway

 

Pretty sure thats what the posters above are referring to

 

I read op to be a annual fee on top of their usual fees if theyve got a new tenant.

 

Yes a additional annual fee ..... so theres the lease renewal fee then after that a annual fee too

 

Keep us posted on what lame excuse they give to justify

Im ready for a laugh

 

Does anyone in SA NOT charge this fee?

 

An annual charge on top of a % fee may be hard to defend against an allegation of misleading and deceptive conduct especially where it may have crept into the agreement unlike say a new engagement where it may be stated at origin. A $fee for a relisting, new lease etc I get and accept this reflects a charge for a specific service. This can vary widely between a low $80+ amount all the way up to a full months rent in the numerous client reports I see. Short term lets are always higher than perm lettings too.

I'm also not fan of add ons like $5pm for postage etc (esp when statements and the like may be emailed), $30-$99 for an annual statement (which is generated by software and emailed !!) and the emerging trend of increasingly hefty fees for inspections, open homes and also tribunal appearances (which may arise from poor PM effort in the first place).

But to impose a % fee and an annual fixed charge for no further services seems a way to disguise and mislead about a % rate that is common industry practice. The flat fee may support a period of no tenancy but then if the agreement says X% then the flat fee is a misrepresentation and a duplication of charge.

Maybe worth throwing this one to Fair Trading SA under ACL (Australian Consumer Law). If the agent is a regional town and dominates the market it could also be a concern