Paying a commission on flat rentals

Old May 17th, 2011, 08:43 AM
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Paying a commission on flat rentals

I have rented flats in Paris, Rome, Florence, Barcelona and throughout Germany. I've used VRBO and various agencies. I have hever been aware of being charged a commission.

I recently rented a flat from an online agency and by my calcuation, they charged a 20% commission, which was passed on to me (not to the owner.) After the amount was charged to my credit card and I questioned the commission, I read the fine print. On about the 3rd page of the site's Terms and Conditions it said that the user would be charge a "variable commission."

Stupid me for not reading that in advance. Stupid me for not nailing down the amount of the commission. Stupid me for thinking that the amount they said it cost would be the amount it actually cost.

I just wanted to warn everyone to not be as stupid as I was.
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Old May 17th, 2011, 08:49 AM
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surely you know that agencies are not charities and do make money off what they do, they all charge commissions. Whether the owner pays it or you do, or whether it is in the rent or notated separately, that's just semantics.

But of course you should read terms carefully for anything you sign, anyeone should do that in all cases, so of course you should read any document before agreeing, that was a mistake. Even if there wasn't a separate commission fee, you should still read documents or rental agreements, etc. Lots of French agencies that rent apts rent them long or ST and the online quotes will often include the commission for ST rentals but not for LT rentals (and the terms will vary).

Why don't you state what agency you used, it might be helpful. I rented from lodgis.fr for one that charges a commission, but it was already in the rate for ST but I certainly knew what it was, they state it. The only thing that sounds weird in your case is if they didn't tell you what the rate was, I can't imagine how that was legal (to just say it was "variable" and not tell you the percentage before you rented the place). Lodgis states this upfront right on their website, it wasn't hidden in any way and there are others like that, also (eg, parisattitude).
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Old May 17th, 2011, 08:59 AM
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VRBO = Vacation Rentals By Owner. This is why you never paid a commission with VRBO - you dealt directly with the owner. All agencies get paid by commission, whether it's part of the total rental amount, or a separate commission as in your case above. From what I've seen over the years, the flat rates offered by most agencies are about 40 percent higher than the rates charged by the owner directly for the same unit (if you can even find an owner-direct listing if they're already using an agency).

I would never rent from an agency again. Some people, however, are comforted by the idean that there will always be an agent available if there's a problem during the rental. I have found this not to be the case, as in, there's not always someone available to fix the problem. And some people think they're getting a better unit with the more money they pay. I have also found this not to be the case.

VRBO is a great resource for locating owner-direct units.
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Old May 17th, 2011, 09:27 AM
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Believe me, I looked at VRBO first.

Yes, I know there are commissions, but in the US they are included in the rental amount. I assumed (I know, big mistake)that any commission or fee was included in the rental rate. The booking form mentioned service charges, cleaning fees, tax, etc etc. I knew that the sum of those fees would be added onto the rate quoted. However, the amount of the commission was not stated on anything, not even the acknowledgement of booking. I received a follow up email that said how much was charged to my account, which was almost $500 more than the "bottom line" stated on the booking form.

I would prefer not to mentioned the name of the agency, because my guess is that many agencies have this practice and I posted my saga of stupidity so that others may learn from my mistake.
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Old May 17th, 2011, 09:31 AM
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Generally renting through an agency is more expensive than directly w/ the owner. W/ an agency, one way or the other you pay a 'commission' -- though it isn't always called that. Either the owner sets the rent higher to cover the agency costs, or it is a separate line item called a commission. But either way -- that is the cost if you want the extra 'security' of renting through an agency.
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Old May 17th, 2011, 09:49 AM
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A commission is fine as long as it is disclosed when booking. While a 20% commission is outrageous, if stated up front, a consumer could evaluate whether he is willing to pay that much for the added "security." My objection is to the hidden nature of the charge.
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Old May 17th, 2011, 10:12 AM
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Most agencies don't charge a commission -- but the higher rent is the same thing. A hidden 'commission'.
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Old May 17th, 2011, 10:23 AM
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Right...when the commission is factored into the rent, the consumer can look at the price and decide whether or not to pay that much. With the commission added after the credit card number is given, the price goes up unexpectedly by 20%. I may have been willing to pay the full amount had I been told the bottom line in advance. But I would like to have been given the abiblity to make that decision.
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Old May 17th, 2011, 10:57 AM
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I have rented from agencies as well as directly from the owner and, like Holly, I much prefer dealing with the owner directly. But when I used an agency I always knew the exact total cost before handing over my credit card number. An agency that adds $500 to the price seems very suspect to me - I don't quite understand the reluctance to name the agency as you would certainly be doing a service to anyone contemplating using that agency. I can't believe that's a normal practice.
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Old May 17th, 2011, 11:16 AM
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I just checked the contract I signed a few years ago with Paris Vacation Apartments. The cost of the apartment is clearly stated in the contract that I signed and faxed back to them. It also included an authorization to charge my credit card with the appropriate amount. The same when we rented from another agency.

This is a good tip for people to read through the agreement, but I don't think "a variable commission" is normal business practice for rental agencies. I, too, would like to know the agency.
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Old May 17th, 2011, 01:02 PM
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I would like to know the name of the agency. When I rented from Paris Attitude I know there was a commission and that it was added in the final price. I knew exactly what I would be charged.
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Old May 17th, 2011, 01:40 PM
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I think you need to get your credit card company to reverse that charge because THAT is not what you agreed to when you pressed "buy this" or whatever approval .

My god. This is horrible, No way can this be common practice and it if it is becoming frequent .. thanks for warning.

How could anyone think that listing the cleaning fee, etc. plus rental equals XXXXE, you BUY it with your card and THEN receive additional charges can even beLEGAL.

Broadcast the name of this agency as you will really be doing everyone a favor.

I would take my business elsewhere rather than be ripped off with an unannounced variable commission of 20% .
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Old May 18th, 2011, 04:20 AM
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I'll post the name eventually but under a different screen name. I use the same screen name in several places and it would be easy for the company to connect my real name to my posts.

I am going to contact the credit card company. I first emailed the agency asking to cancel without penalty and reverse 100% of the charges, but of course, I haven't heard back from them.
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Old May 18th, 2011, 04:22 AM
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As an aside, I am also trying to rent a flat in another country. I asked whether the price quoted was the total price and whether it includes a commission, etc. The lady emaled back that the commission is paid on an annual basis by the property owner. Of course, it is factored into the rate,but no surprises.
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Old May 18th, 2011, 05:56 AM
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I can understand your frustration. I agree, that I don't mind paying a commission -- that is what an agency does! However, it was the "add-on" nature of it that irks.

The best analogy I could make is when you are quoted a price for a hotel and when you get there, you are charged an extra $30 "mandatory" resort fee, as well as $20 valet parking fee (with or without a car).

It feels like a scam and they absolutely are not disclosing it upfront so that their price looks less than the final price.

I, too, would love to see the name of the agency. Just a quick clarification -- you asked about the "hidden" nature of it and they refused to refund it to you. Why the concern if they know your real name vs. your screen name ? Do you feel you lose anonymity ?
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Old May 18th, 2011, 08:14 AM
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Yes, I don't want to lose annonymity. I have posted under this screen name for years. I'd really hate to have everything I've ever posted broadcast to the world. Nothing really incriminating, just more silly stuff.

The moral of the story is to (1) check out the rental agency (I searched google a couple of times and found nothing negative, (2) read the fine print (note that in my case the "fine print" was the "terms and conditions" that is at the bottom of every web site, not in the booking info, (3) confirm and reconfirm in writing that the price you are paying is the entire price.

#3 is the one that got me and when I think about it, the agency's site is tricky. When you ask for an offer, you are put in touch with the owner. So the communication about price is with the owner, who is honestly telling you HIS price. So you book...mind you, the agency's booking form mentioned a service charge and a cleaning fee that had not been included in the price the owner quoted. Okay, I agreed to that, too. But commission...no mention.

Just be careful out there and collect as much of a paper trail as you can.
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Old May 18th, 2011, 10:11 AM
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It's kind of hard for anyone to assess this without knowing the agency and what the website actually says. I would be sympthetic if it were totally hidden and you had no idea, but I have also read too many posts from people who say they didnt' know something and complain and the website states it very clearly. Lodgis.com also puts you in touch with an owner, a lot of rental websites do that. But the agency fee or commission was very clear in all the FAQs on the website, which I read. And that is the key thing, you said you didn't even read the contracts, so it's kind of hard to feel sure that you weren't told what the commission was before you gave them your money/CC. It is also possible that "variable commission" was just the term in one place (as it may vary by price of the apt or lenght of rental) and other places stated the terms clearly or they were filled in based on your choice. I think lodgis does that, actually.

But I'll admit whatever website you used sounds dicey to me and I never would have used it in the first place because you are saying the website doesn't even have rates on it, they you have to find out from the owner. That puts it much farther from agencies like lodgis.com or parisattitude.com that have very clear standards and terms and even though they are not the owner, there are prices on the website for the apartments. So it sounds like you were dealing with some real amateurish operation and that entire situation would have been something that I wouldn't have been attracted to (no standard prices).

I don't consider "terms and conditions" on websites to be that sneaky or tricky, that is what they are for and I always read them. So I agree that the moral is to read all terms on a website but I'm not persuaded that you were really cheated.
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Old May 19th, 2011, 06:09 AM
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The commission was never stated. The only reference to a commission was to a "variable commission." I admit that I should have never agreed to such terms. Christina, I have a feeling that you are affiliated somehow eith lodgis.com. That is fine and I am glad they are honest.

The agency I dealt with is huge and has hundreds of properties all over Europe. I would say that the operation is about as far from amateurish as it can get.

I didn't start this thread to get sympathy. I just wanted to warn others. I thought I was fairly sophisticated in this type of thing but I was taken.
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