Landlords still suffering, warns OFT

Letting agents are still using unfair terms and conditions for landlords despite a landmark ruling which prompted Foxtons to change its contracts, the Office of Fair Trading (OFT) warned.

It urged operators to check that their terms and conditions are fair and transparent and has written to a number of agents and industry associations to point out the results of the legal case.

The OFT secured a High Court order against Foxtons last year after a judge said that some of its fees were like a “trap” for landlords – many of whom were buy-to-let investors.

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Mr Justice Mann also said a number of terms and conditions were unfair and were not flagged up prominently enough.

These included requiring landlords to pay commission of 11 per cent of the annual rent if a tenant remained in a property beyond the initial term, even if Foxtons played no part in persuading them to stay, or was no longer collecting rent or managing the property.

The judge added such important terms should be flagged up prominently not just in the contract, but also in any sales literature.

The OFT said it had carried out research that showed that the order had saved landlords at least £4.4m a year, but many landlords and lettings agents were unaware of the ruling.