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The rental market is booming, increasing the importance for landlords to know what the average letting agent fees are across the country.

With changes in legislation concerning tenant fee bans & offsetting mortgage costs and the BREXIT doom and gloom, keeping on top of fees is critical to maintaining a profitable property portfolio.

If letting agent costs are too high, profits from a rental property can be quickly eaten up

The letting agent fees you pay will depend on how hands you want to be with your rental property.

Some landlords just want their agent to find them tenants. Whereas other landlords want agents to take on inspections, maintenance, inventories and a whole lot more.

 

1. THE BEST LETTING AGENT NEAR YOU

If you have a property in England, the below analysis will be useful for understanding average fees letting agents are charging. Furthermore, you can see precise fees agents are charging in your area. In

Every town is different and so are the letting agent fees landlords will face, so finding the best letting agent is always simple. Rent Round allows landlords to compare letting fees of agents near a landlords rental property.

A quick comparison shows % letting agents charge for tenant find, full management & guaranteed rent services.

Type in your post code to see letting agents near you. We will also show you letting agent ratings and distance from your property.

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Enter your postcode & find the best agent for your property

 

2. AVERAGE LETTING AGENT FEE CALCULATOR

Wherever your property is in the country, the below calculator will give you an idea of the average letting agent fees in your city. Simply enter the city your property has and the number of rooms.

The calculator will work out the expected rent you should expect based on national averages. You’re also able to see an estimation of your take home profit after letting agent fees, tax & bills.

Letting Agent Fee Calculator

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200 1,000 1,800 2,500

3. TYPES OF LETTING AGENT FEES

There are many types of fees rental agents charge landlords. This will be dictated by the services the landlord is looking for. The fees are generally broken down into the following groups

LETTING AGENT TENANT FIND FEES

This fee is for the cost of advertising your property, answering tenant queries, conducting property viewings and creating the tenancy agreement. Depending on the agents terms and your agreement with them, this service can also include the ongoing rent collection for that tenant.

LETTING AGENT FULLY MANAGEMENT FEES

This services goes over an above finding the tenant and is usually taken up by landlords looking for a hands off approach. The letting agent will in addition manage the property inspections, documentation, maintenance and for sure the ongoing rent collection.

LETTING AGENT ADD ON FEES

There are a host of other activities that the letting agent can charge additional fees for. These include, but are not restricted to:

  • Premium advertising
  • Guaranteed rent policies
  • Bill payment processing
  • Tenancy renewal fees

As a landlord, you should always read the small print and understand what services are included and what you may be charged more for.

GUARANTEED RENT FEES

This type of service is for landlords looking for a risk averse approach, by securing their rental income against a policy.  In the event that a tenant cannot (or won’t) pay their rent, the policy undertaken secures the income.  After a certain amount of time of unpaid rent, the policy will kick in and a landlord gets their payment.

Every policy differs. Some require a landlord to wait a few weeks or even months. On the other hand some policies pay out as soon as a payment is missed. Landlords using this service can get a peace of mind knowing any mortgage payments or bills aren’t at risk of a tenant not paying their rent.

There is a higher cost of this service, which means a landlord’s monthly income will take a hit. During the Covid-19 pandemic, landlord searches for guaranteed rent increased by 25%. In the midst of tenant arrears & eviction bans, it’s clear landlords were keen to get coverage from themselves. However many agents pulled back their offering of guaranteed rent.

Many agents couldn’t find a provider to underwrite this type of services as arrears across the country increased.

4. LETTING AGENT FEES – WHAT THE BIG AGENTS CHARGE

The below table shows how much the most well known letting agents will charge for finding a tenant, full management and guaranteed rent. The structure of how an agent will charge a landlord differs.

Some prefer an ongoing monthly fixed fee or % of the rental income. While other charge a flat one off fee at the beginning of the tenancy.

Agent

Tenant find fee

Full management fee

Guaranteed rent fee

Agent rating

4% pcm

9% pcm

N/A

10%

19.2%

N/A

13.2% pcm

19% pcm

3.6% pcm

£820 one off

12% pcm

3.56% pcm

4 weeks rent

14.4% pcm

N/A

£690 one off

£80 pcm

£20 pcm

9% pcm

12% pcm

£250 one off

13.2% pcm

20.4% pcm

N/A

£1450 one off

6% pcm

N/A

Based on the data, there are huge variances between what fees are charged. The cheapest agent to find a tenant is Hello Neighbour. Whereas the most expensive, based on a monthly rental income of £1,000 is Foxtons & Knight Frank.

Both of these agents are large, well known brands with a strong foothold in the market. With many offices and a good hold on Google rankings, they can offer up their services at a premium level.

Hybrid agents Home-Made, Accommodation & Hello Neighbour are challenger agents, targeting landlords looking for lower cost options to let out their property.

Hello Neighbour and Accommodation in particular are performing extremely well based on the quantity and quality of their online reviews.

 

5. HOW DO AGENTS PERFORM?

Picking the best letting agent isn’t always simple. The cheapest doesn’t mean the best and the agent that will do the most for your property may not be cost effective enough for your aims.

Looking at how quickly an agent lets out your property and what rent they achieve, can be another good indicator to look at when picking your letting agent.

Take a look below and see which agents get the most rent and their timeframes to get your property rented out. Remember this data always fluctuates.

Agent

Average monthly rent obtained

Average listing time

Comparable on Rentround

£1,900

2

Yes

£1,600

2

No

£1,600

2

No

£1,855

3

Yes

£1,330

2

No

£1,787

1

Yes

£2,789

2

Yes

£2,119

5

N/A

£2,002

3

Yes

For a more accurate view, run a letting agent comparison on our homepage.  Metrics have been taken from publicly available data, including Right Move & Zoopla

 

6. AVERAGE ONLINE LETTING AGENT FEES

To get a fair view in this modern day, you need to consider online letting agents when trying to get a sense of what an agent may charge you.

Online letting agents aren’t for everyone, the expectation is the landlord would need to do more work than they would need to do under a ‘normal’ agent.

However no doubt, there are big savings landlords can make when getting an online agent to rent out their property. Some agents charge just double figure to find a tenant – a big difference to being charged an entire months rent to find a tenant, which some traditional agents charge.

The below table outlines how much online letting agents charge.

Online letting agent

Tenant find fee

Full management fee

Key information

£149

£99 per month

Nothing to pay until the property is let. Rent protection included.

£99

6% per month

Capped at £95, set up fee of £199, £99 upfront

No frills service, landlord does the viewings. Cheaper management fee available but doesn’t cover maintenance.

Unfortunately this online agent seems no longer in operation

£49

Not on offer

A cheaper service is available but does not include contract signing, initial rent collection or deposit registration

£149

Not on offer

Tenancy set up not included

£500

6%

Min fee £40 pcm, set up fee of £250

Cheaper DIY let available at £99 paid on instruction

£29

£55

Pay upon let

Rent protection included in management fee.

£30

£65

Premium packages available that include emergency cover and legal protection

£10

Service is on offer but no price quoted on their website

Landlords can build their package, adding variables such as referencing, agreements and certificates

Free

(we spent a lot of time on their site but couldn’t figure out if the service is on offer and for what price!)

Free advertising on the main portals. A range of add on fees for other services

Not on offer as an individual service

£59 outside London, £89 inside

£149 extra set up fee to find a tenant as part of the management service

£99

£45 pcm

Management service is actually provided by Howsy

£99

Not on offer

Basics covered, higher package available for more comprehensive services

£900

£120 pcm

All fees now paid on let, instead of upfront

7. Expert Opinion

“For many landlords, understanding what letting agents charge can be tricky to understand.

You have your basic services to consider, then a host of add on’s such as insurances etc.

For many landlords, its 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 in the future.

Reputation, not just fee, plays a big part when picking a letting agent. No landlord wants a letting agent that has a reputation of not pulling their weight. In recent times there’s been a massive push by agents to get online reviews in check to attract more landlords.”

Raj Dosanjh, Rentround founder

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Avatar photo Rentround August 16, 2022

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