What You Should Know About Letting Agent Fees
As a landlord, you want to make the most money on your property. Which is why understanding letting fees is so important. What are letting agent fees for landlords? What do they cover, and are they worth it? This guide answers these questions and covers other topics, like tax treatment, what fees are allowed under the law, and how to compare agents.
1. Letting Agent Fees: A Quick View
- Letting agents charge different fees depending on the service you want.
- Tenant find services typically cost around 6%–13% of the monthly rent and cover marketing the property, tenant checks, and tenancy agreements.
- Rent collection services usually cost 5%–10% of the monthly rent and include collecting payments and chasing arrears.
- Full management is the most comprehensive service and normally costs 12%–20% of the monthly rent - the agent handles maintenance, inspections, and tenant issues.
- Some landlords choose DIY platforms where they pay a small one-off fee to list the property on portals and manage the tenancy themselves.
- The best option depends on how involved you want to be - cheaper services mean more work for the landlord, while full management costs more but removes most of the hassle.
2. Common Letting Agent Fees & Services
Tenant Find 6% – 13%
Finding qualified tenants is one of the hardest and most important steps. Usually includes marketing, performing tenant checks, drafting the tenancy agreement. May also cover viewings and collecting the first month's rent and deposits.
Rent Collection 5% – 10%
The agent chases down late payments. Services may include reminders for missed payments, communicating with the tenant to resolve late payments, drafting rent statements, transferring rent payments to the landlord, and handling arrears. Often combined with tenant finding.
Full Management 12% – 20%
Includes tenant finding and rent collection PLUS the agent handles all property maintenance and repairs, property inspections, fielding tenant phone calls, managing renewals and rent increases, and dealing with legal issues like eviction.
Guaranteed Rent £160 – £300
Different from rent collection - you get paid even if your tenant fails to pay. Covers rent arrears, as long as you qualify.
3. Other Letting Agent Fees to Consider
While some agents charge a flat letting fee, others price services individually. Ask before signing a contract.
Administration Fees
A letting agent will process and manage all the essential paperwork.
Renewal Fee
Charged after the initial letting term ends when tenants renew their agreement.
Check-In and Out Fee
Covers meeting the tenant on moving day, conducting inventory checks, and discussing housekeeping.
4. Tenant Fee Ban
The Tenant Fees Act of 2019 banned most charges for tenants to make letting more fair and affordable. It bans most routine, upfront, or admin charges to tenants - including admin fees, referencing, and inventories. Rent, deposits, and other limited costs aren't included in this ban.
Breaches can lead to legal action and/or penalties. Letting agent fees are also approved expenses for tax purposes, as long as they are incurred "wholly and exclusively."
5. How to Compare Agents
Three most common types of letting agents:
- Local High-Street Agent: Often more expensive, offers local market knowledge and a more hands-on experience.
- Online Agent: A more hands-off, affordable option if you're willing to shoulder some work. Some are "DIY agents" that just let landlords create a post on the large property portals.
- Hybrid Agent: Online services but may also have a local representation (no office). Often a bespoke experience.
Sample Charges Comparison
As of 21st Feb 2026
| Agent | Tenant Find | Management | Guaranteed Rent |
|---|---|---|---|
| Romans | 9% / mo | 12% / mo | 3.5% / mo |
| 99home | £39 one-off | £72 / mo | £129 one-off |
| Hello Neighbour | £1,440 one-off | £90 / mo | £240 one-off |
How to Compare Agents
- Read Reviews: Don't just check the agent's website. Search reputable review platforms to see what past and current clients say.
- Check Credentials: Check if they are members of NAEA, ARLA, and/or Propertymark. See what client-money protection scheme they're enrolled in.
- Use a Comparison Tool: The fastest way to compare letting agent fees is a comparison tool like Rentround - a side-by-side view of different local agents, their fees and services.
6. Do I Need a Letting Agent?
The short answer is no - you don't have to. But unless you plan to fully manage your properties yourself (tenant referencing, rent collection, inventory, repairs), paying letting agent fees is usually worth the investment.
Pros
- ✓ Listings on popular property portals including Zoopla and Rightmove
- ✓ Market insight and experience
- ✓ Handling all necessary paperwork to remain compliant
- ✓ Deposit protection in a government-approved scheme
- ✓ Rent collection and inventory checks to help maintain a positive tenant/landlord relationship
Cons
- ✗ Paying letting agent fees cuts into your bottom line
- ✗ Letting agent fees in larger cities like London can be more expensive
Letting Agent Fees Example
Example 1: Percentage Fee
Property generating £1,500/month. Agent charges 10% of monthly rent. Each month you pay £1,500 × 10% = £150. You keep £1,500 − £150 = £1,350.
(Note: agents state fees including VAT, so there should be no VAT add-on after the agreement is made.)
Example 2: Flat Fee
Same £1,500/month rent, but an agent charging a flat £100/month. You keep £1,400 and pay the agent £100.
Managing the property yourself saves money, but consider whether you can stay on top of documentation and regulatory requirements, and the extra time required to deal with issues.
"As the rental market faces more regulation in 2025, more landlords will find it difficult to operate. Renters reform, EPC requirements and tax changes all add more complexity. As a result, letting agents will play a bigger role for landlords. There are a range of services offered by letting agents but for many landlords, understanding what letting agents charge can be tricky. You have your basic services to consider, then a host of add-ons such as insurances etc. For many landlords, it's a toss up between getting more profits out of a rental property or less hassle. For those landlords that live near their property and have time on their hands, a low cost agent that gets your property advertised may be a good idea. However when distance and time is an issue, it may be better to pay an agent with higher fees to cover more of the services needed. Reputation, not just fee, plays a big part when picking a letting agent."
