Letting Agent Fees | Guide & Fee Calculator
Letting agent fees can be difficult to understand and calculate. Some fees are ambiguous and the exact services on offer not always clear. Regional differences in letting agent fees add to the difficulty for landlords. Looking for a letting agent fee calculator? You’ve come too the right place.
To see how much agents charge in your area, enter your postcode in our letting agent fee comparison tool.
We then show you local agent fees. In addition, we show you ratings, location & services offered by agents in your area. The comparison tool is free and takes 30 seconds to show results.
In this article is also an overview of letting agent services, what fees some of the popular letting agents charge and some things to look out for when dealing with a letting agent.
Navigate to what you need:
1. COMPARE letting agents NEAR YOU
To compare letting agents near you, enter your postcode below.
The comparison tool will show you letting agent fees, ratings & services in your area. This will give you a precise view on the agents in your area and what fees are on offer.
The services is completely free & results are shown within 30 seconds.
Compare letting agent fees
I got the best priced agent in my area with all the services I wanted. Using Rentround I could see all the local agents in my area after just putting in my postcode.
2. Letting Agent fee calculator
Just browsing? If you haven’t got a property yet and just looking to get an idea of potential letting agent fees, play around with the below calculator.
You just need a rough idea on how much rent you’ll be charging and what services you need from a letting agent
Expected Rental Income (£)
3. Letting agent fees charges by popular letting agents
Take a look at the prices below to get a snapshot of letting agent fees charged by various agents. We’ve included a mixture of different types of agents; Online agents, popular nationwide agents & local agents.
|Agent Name||Tenant find fees||Fee Type||Full management fee||Fee Type|
|£149||Fixed Fee||£59||Monthly Fixed Fee|
|£49||Fixed Fee||£85||Monthly Fixed Fee|
|100%||First months rent||14.40%||Per Calendar Month|
|£129||Fixed Fee||5%||Per Calendar Month|
|£400||Fixed Fee||9%||Per Calendar Month|
|£250||Fixed Fee||12%||Per Calendar Month|
|10%||Per Calendar Month||12%||Per Calendar Month|
|10%||Per Calendar Month||15%|| |
Per Calendar Month
4. Letting agent & property manager services
Every property agent is different, including their fees and services offered.
Some agents charge for tenant finding fees and the service is exactly that, finding you a tenant!
No tenancy agreement, no referencing and no viewings.
Below are descriptions of the services included in our letting agent fee calculator. This will help you understand what services are being costed out and what potentially is being excluded.
Remember, we recommend using our letting agent and property manager fee comparison feature. This will give you a breakdown of fees & ratings personalised to your property location.
Tenant find fees
Services we have assumed under this fee include:
- Advertising the property
- Conducting property viewings with potential tenants
- The initial tenancy agreement
- Rent collection
Note: Occasionally landlords need to change a tenancy midway during the term. This usually includes an additional admin fee which will be between £30-60.
Furthermore, after 12 months, a tenancy renewal charge is usually applied to the landlord.
The tenancy renewal charge can be substantial. Some agents charge the same as finding a tenant in the first place!
How much do letting agents charge for tenant find services?
Costs depend on if you want the agent to do most of the work (therefore most likely opting for a traditional agent) or you’re willing to do some of the leg work yourself.
An online agent will charge between £80 – £200 to find you a tenant, conduct references and get the tenancy agreement in place
A traditional agent will change you between 8%-12% of monthly rent. For the higher fees you can expect more services undertaken in return.
Be sure to enter your details into the letting agent fee calculator above. This will enable you to get a better view of what fees you can expect as a landlord.
Fully managed agent fees
Fully managed services are supposed to leave the landlord pretty much hands off when it comes to managing the property.Aside from the above tenant find fees, letting agents & property managers will also cover:
- Property inspections
- Notice processing
- Maintenance of the property
- Dispute resolution
Maintenance can be a contentious issue. Landlords want to avoid being charged £1,000 for a squeaky door (that’s an exaggeration of course!).
Therefore when it comes to damages & repairs, landlords want to have an element of control.
Landlords need to be involved in finding contractors, comparing repair quotes and giving the go ahead for a repair to be done.
This reduces the risk of landlords feeling they have been priced unfairly, based on their letting agents or property managers’ costs.
How much do letting agents charge for fully managed services?
For fully managed activities, commonly a 12-18% fees of monthly rent will be charged. Use the letting agent fee calculator above to get a view based on your expected rental income.
Guaranteed rent fees
Guaranteed rent policies are created to pay out to landlords, should rent not be received.
Depending on the small print, landlords are usually covered if:
- If tenants decide to run off
- A tenant simply does not pay, or
- If the property is damaged and therefore inhabitable for a period of time
The policy can therefore be used to add a buffer for any mortgage payments the landlord needs to still make.
You’d need to vet the policy carefully. As with any insurance policy, the pay out terms can be complex. Landlords may not get paid out for 6 months under some terms.
How much do letting agents charge for guaranteed rent?
Prices range from £80 – £200 per year. The more expensive policies tend to have less restrictions and lower pay out periods.
5. Miscellaneous letting agent & property manager fees
As there are a high volume of letting agents & property managers on the market, there are a host of other fees that can be charged to landlords.
These fees sometimes are already wrapped up in the service agreement you have. On the other hand some property agents will charge separately.
Below are some of the fees landlords will need to look out for, should the services be required
Tenant renewal fee
If the letting agent or property manager has found you a tenant, the term for that tenant (i.e. the duration of the rental agreement) will be stated in the tenancy agreement.
Once that term ends and you want to keep the same tenant, a tenancy renewal fee could be requested.
Landlords can find this fee frustrated.
The hard part of the job, finding the tenant, is already done.
The renewal fee covers the writing up of the new agreement, included new regulatory terms and updating dates etc.
If you don’t want to pay this fee, you need to ensure it’s not included in the agreement you have with the letting agent or property manager.
The tenancy renewal fee also cannot be passed onto the tenant, due to new legislation in 2019.
How much are letting agent tenancy renewal fees?
Agents usually charge £45-£120 for renewing a tenancy agreement. Not all agents charge, so again check the small print.
Once the term in the original agreement expires, landlords can switch their tenant to become ‘periodic’. This means the tenancy becomes a ‘rolling’ contract with no end date, usually involving the original set of terms and conditions
Reserve fund fee
Accidents & damages do happen. Letting agents & property managers don’t usually want to front the bill & charge landlords after the event (they’d rather have the money first!)
Chasing landlords & transferring cash, may take time. Therefore some agents charge a reserve fund fee.
This is a pot of money taken in advance from the landlord to cover any damages.
If the pot is used, it’s then returned after the agreement between the landlord & agent.
How much are letting agent reserve fund fees?
It really depends on your property value. The more valuable and larger, the more that can go wrong. Expect fees in the £200 – £1000 range.
This service is for landlords that like that little extra luxury in life.
Mortgage, electric, gas and service bills all need to be paid. Landlords looking to get the admin of paying these bills offloaded can look to a property agent.
An agent pay the bills on your behalf, saving you the hassle of keeping track of what’s been paid and overdue.
How much are letting agent paying your bill fees?
Usually an agent will charge 1.5% – 4% of the amount billed.
These fees are probably the most annoying out of the possible fees a landlord can be charged.
The fee charged is to take care of adding your profile on a system; Things like adding your bank details on the agent’s platform, setting up direct debits, recording your contact details etc are usually a reasoning for this type of fee.
If you’re being charged this fee, it’s worthwhile pushing back on your agent and get this fee scrapped.
It’s unlikely an agent will turn away your business because of you not wanting to pay this fee
How much are letting agent admin fees?
Anywhere between £50-£200.
Unfortunately tenants need to be evicted from time to time. Whether its not looking after the property, false information given in referencing checks or rent arrears, eviction procedures need to be engaged.
When evictions take place, notice to the tenant needs to be given and sometimes the case needs to be taken to trial.
Then once all done, the tenant needs to be removed from the premises in cases where they are reluctant to leave.
This can take a lot of time and expertise is needed to ensure legislation is stuck to.
Letting agents & property managers will usually charge a fee for these types of services.
You need to look at the cost benefit of getting their experience for this procedure. If an agent can do it quicker & more effectively then you can do on your own, it will mean you can get a new tenant in quicker and start to receive rent again.
Remember, during an eviction, your mortgage provider is still going to expect & chase their payment.
How much are letting agent tenant eviction fees?
£120 – Eviction notice
£850 – Getting the Court Order
£250 – County Court Bailiff
Late Payment Fees
If your letting agent or property manager undertakes maintenance/repair work on your behalf depending on your agreement, they may invoice you after the work.
This invoice will have a due date, commonly 14 days post the invoice date.
If you delay this payment and there is no reserve fund pot, you could be charged for the late payment.
How much are letting agent late payment fees?
Landlords can expect to be charged a fixed fee of £30-100, or a 3-10% of the due payment.
You may have selected a fully managed service with your agent which includes maintenance, therefore these fees may not apply.
However if not and you require the agent to conduct maintenance work, the agent will add a mark-up on top of the contractors charges.
This is reasonable considering the agent has had to coordinate the repair work. Finding a contractor, arranging suitable times for the work to be conducted and paying the contractor on your behalf can be cumbersome.
How much are letting agent charges for ad-hoc maintenance?
Landlords can expect between 10-15% of total bill to be added to cover the agents time. Again if you have opted for a fully managed service & maintenance is included, this fee should not be charged to you.
Estate agent fees
For landlords looking to sell their property, the agent will of course take their commission.
Advertising the property, conducting viewings and dealing with negotiations are part and parcel of this service.
With the invasion of online estate agents in the property market, landlords now have financially better options when selling their property.
Instead of a commission based on % of the properties sale value, online agents offer a fixed fee system.
Regardless of how much the property sells for, the fee to the agent stays the same.
However with the lower fees, landlords may have to do more of the work themselves.
Commonly this will involve arranging & conducting viewings. Fine if you have the time. But for the busier landlord this may not be possible.
However be mindful that an agent may charge you a fee, if you decide to sell your property while still within the fixed term of an agreement.
So even if you sell the property via a different estate agent, as you’ve broken the term with your rental agent, a fee may be applied. We cover this below, see the exit fees section.
How much are estate agent fees?
On a commission based on the properties sale value, 1.5% – 3% is the general fee sellers can expect. With an online agent, fees of £99-£1000 are available.
Early exit fees
If you have signed an agreement with a property agent, within that agreement will be a term.
This term refers to how long you agree to use that agent for rental services.
If you wish to exit the agent early, an early exit fee may apply. This adds some security to the agent should landlords exit early.
This fee is reasonable, as there is an agreement in place and the agent will need some security for their own business.
If however, you are wanting to exit because of poor service, exit fees can be challenged.
If the terms of agreement haven’t been stuck to by the agent, then landlords can be well within their rights to exit the agent without incurring a fee.
Rent not being collected, the property not maintained or landlord requests not being adhered, are all possible dispute topics.
This signals ever more importance to what’s included in your agreement with the agent.
Ensure you cover all the aspects of services you are paying for in the agreement. In addition make sure early exit fees are looked at, including wording the agent has included where exit fees do not apply.
Furthermore, if your agent is adamant that early exit fees are going to be applied, then the following complaint procedures can be followed:
“One good thing about dealing with letting agents is that they have to be part of an approved redress scheme. This has been a legal requirement since 1 October 2014.
Redress schemes can help you resolve a dispute between you and your letting agent.
Both landlords and tenants can complain to these schemes, which help to mediate disputes between landlords, letting agents and tenants over letting agent failings.
If you’ve exhausted the letting agency’s internal complaints procedure and are not satisfied with its response, you can take your complaint to one of these schemes.
All letting agencies must clearly state which scheme they are members of. The government-backed schemes are:
- The Property Ombudsman (TPO)
- The Property Redress Scheme”
How much are letting agent early exit fees?
Exit fees can be up to 10% of the remainder rent that is still expected, for the remainder of the term.
So let’s say you wish to exit your agent, because of reasons excluding a dispute regarding the service. You have 6 months left and rent equates to £1,000 per calendar month.
Your early exit fee would £100, multiplied by the number of months still in the agreement = £600.
Tenant Late Payment Fees
Within the tenancy agreement, usually stipulated is how much tenants need to pay additionally, if they are late on rent.
This is used as a deterrent to the tenant failing to pay rent on time.
Letting agents can then take a piece of this late payment charge as commission. Late payments have to be tracked & chased, which is their justification for taking a piece of the fees.
Ideally, you want to negotiate this type of fee out of any agreements with the agent.
Agents making money from tenants not paying on time is not a behaviour you want to incentivise!
How much are letting agent late payment fees?
5% – 10% of the fee charged to the tenant for not paying rent on time can be expected to be paid to the agent.
Usually, tenants face appx 5% hit because of not paying on time.
Recording a detailed list of items within your property prior to letting it out is essential for dispute resolution.
Therefore, if you find items are missing or damaged, the original inventory can be referred back to as a reference.
How much are letting agent property inventory fees?
Landlords with smaller properties can expect to pay around £100. When properties with more than 3 beds are involved, prices can go up to £200. Note, we included this cost in our letting agent fee calculator at the top of the page
6. Letting Agent Fee Ban
Both sides of the letting agent and tenant relationship need protection, which is why there are several laws and guidelines in place to do just this.
A recent Tenant Fee Ban is one such rule that was recently enacted to help protect tenants from unfair or exorbitant charges. Renters who fail to ask questions or read the fine print are often at risk for being taken advantage of.
The unfortunate part is that even the best letting agents get a bad name. Tenants assume agents have bad intentions. Understanding the parameters of the Tenant Fee Ban helps all parties involved (tenants, landlords, and letting agents) feel safe and protected.
This impacts landlords in a big way. First if you’re charging fees to tenants, you need to ensure they fall within the law.
Secondly with agents unable to charge tenants for certain services, there’s a risk to landlords of increased costs.
In this section, we’ll discuss all aspects of this recent piece of legislation including when and why it was created and how to successfully navigate your business while remaining compliant.
When Was the Tenant Fee Ban Enacted?
The Tenant Fee Ban came into creation on 1 June 2019. This act made it illegal for landlords to unfairly charge tenants additional fees when renewing a tenancy agreement or entering into a contract for a new property.
Any new contracts signed on or after 1 June 2019 are subject to the parameters of this legislation. As of 1 June 2020, all other tenancy agreements are also impacted by the Tenant Fee Ban.
What is the Tenant Fee Ban?
Remaining compliant with this new legislation means having a full and complete understanding of what it is. We’ve already said that the Tenant Fee Ban stops landlords and letting agents from charging unnecessary fees to renters, but what fees are covered under this ruling?
In short, the only fee that a landlord can rightfully charge a tenant is rent. This ban eliminates hidden charges and prevents landlords or agents from adding on additional fees after the contracts are signed. In addition to rent, tenants are allowed to charge additional fees only if they are specifically named in the contract and listed as an approved payment.
Examples of such approved payments and charges are:
- Utilities, TV license, communication, or Council tax
- A refundable deposit (no more than 1 weeks rent)
- Changes to the tenancy requested by the tenant
- A refundable tenancy deposit that shall not exceed 5 weeks rent (or 6 weeks if the annual rent is more than £50,000).
- Early termination fees if the tenant requests to end the agreement prematurely
- A protected fee for lost keys, security devices, or late payments
- Professional cleaning fees in the event that there’s extensive damage to the property
Here is a brief breakdown based on rent of £500.
- Refundable rent withholding – £500
- Refundable deposit – £2000
- Tenant requested changes to the agreement – £50
- One week late rent – £15
- Lost key or security device – Between £10 and £50
- Early termination fee (if requested by the tenant) – This amount depends on the losses incurred by the landlord or letting agent
Ultimately, the Tenant Fee Ban is designed to improve working relationships and open lines of communication in the real estate and rental market. Some people argue that while tenants are feeling the positive effects of this ban, that landlords and letting agents are experiencing a financial loss.
Benefits of the Ban for Tenants
So what exactly are the benefits of the Tenant Fee Ban as seen from the renters perspective? In the past, tenants faced countless upcharges and additional fees after signing a rental agreement. From tenancy renewal fees to charges for the initial contract set-up, credit checks and referencing, to administrative fees, many renters felt taken advantage of.
Many letting agents were guilty of passing down nominal fees (like cell phone bills and postage) to tenants. Many of these fees were referred to as “administrative” to keep tenants in the dark about what the charges really were. Before the Tenant Fee Ban was created, there was no protection for tenants.
Letting agents and landlords were allowed to charge whatever they wanted, whenever they wanted, without much repercussion or penalty. This meant that some letting agent fees were much higher than others, forcing tenants to shop around and navigate influxes in prices.
The Effect on Letting Agents
While it may seem that the letting agents were at fault and that the Tenant Fee Ban was necessary to protect renters, not all letting agents were guilty of upcharging and adding ridiculous administrative fees to the agreement. Unfortunately, reputable letting agents (both online agents and traditional), as well as landlords, are feeling the negative impact of this new ban due to the immoral behavior of a few.
Some real estate professionals predict that these guidelines could cost letting agents and landlords between £50 and £160m. The whole purpose of the ban is to prevent dishonest landlords and letting agents from adding hidden fees to contracts and tenancy agreements. The ban stops landlords from charging tenants exorbitant fees for things that aren’t their responsibility to begin with.
Here are just a few of the fees that the Tenant Fee Ban prevents landlords and letting agents from charging:
- Any fees related to setting up or renewing an existing tenancy (this includes, but isn’t limited to, credit checks, referencing, and inventory).
- Check-out fees
- Third-party fees
- Viewing or showing fees
The biggest problem for letting agents is that these fees make up a big portion of their monthly revenue. As a result, many agents are now charging landlords increased rates to try and recoup some of their lost income.
Lost income isn’t the only hurdle landlords face in light of this new Tenant Fee Ban. To balance out their own expenses, many landlords are forced to raise rent. This leads to fewer prospective tenants and longer vacancy periods. Without steady income, landlords can’t perform routine maintenance or improvements to their rental properties. This makes it even more difficult to find reliable tenants.
The main reason landlords hire letting agents is to make the rental process easier. After all, being a property manager is a full-time job in itself. From finding and vetting tenants to scheduling showings and performing routine maintenance and repairs, many landlords turn to agents for help. The new Tenant Fee Ban is forcing many landlords to burden these responsibilities themselves to save money. Although this technique saves the landlord money now, it could end up costing more in terms of stress, time, and quality of life. Remember, this is just one new regulation. There are constantly changes in guidelines and legislation to keep up with.
What Happens If You Don’t Comply?
Are you a landlord or letting agent considering not following the rules? Are you desperate to keep conducting business as usual and think non-compliance with the new Tenant Fee Ban is no big deal? Think again.
If you choose not to follow these guidelines you could be facing even more financial trouble. The initial fine is £5,000. After that, a second violation is an additional £30,000 and up to 5 years in jail! In some cases, landlords are taken to court for multiple offences. Not only will disobeying the law hurt you now, but it could permanently damage your reputation.
Word gets around and if you’re known as a dishonest landlord, you’ll have a hard time finding tenants that trust you. Landlords who violate these terms or receive two financial penalties in any calendar year are added to a database for rogue landlords and letting agents. At this point, you’re basically blacklisted in the real estate world.
As of 1 June 2020, all landlords and letting agents are required to follow the Tenant Fee Ban guidelines regardless of how many properties they have.
The Best Letting Agents and Landlords Follow the Rules and Provide Quality Service
The relationship between tenant and landlord is equal parts professional and personal. Landlords are responsible for providing tenants with a safe and secure place to reside at a fair price.
Tenants put their trust in their landlord, which is why the Tenant Fee Ban is an important piece of legislation. The act was created to help foster a transparent relationship between both parties, leading to more trust and a long-term, working partnership.
Letting agents and landlords who choose to ignore not only their moral obligations but legal ones, are at greater risk for ruining both their professional reputations and lifelong careers.
What Letting Agent Fees Are Banned?
- Credit checks
- Fees associated with establishing or renewing a tenancy
- Third-party checks
- Check-out fees.
What Fees Can Letting Agents Legally Charge?
Acceptable tenant fees under the Tenant Fee Ban include:
- Council tax
- TV licence
- Refundable holding deposit
- Changes or payments requested by the tenant
- Payments as a result of early termination by tenant’s request
- A refundable tenancy deposit
- Late rent payments
- A fee for lost keys or security devices
- Cleaning fees for excessive damage.
Compare letting & property manager fees
Now you have an idea about the letting agent & property manager fees you can expect, use Rentround to get the best agent with fees that suit you.
Enter you postcode below with a few details about the services you need, then we will do the rest!
No need to call multiple agents and write down fees to do a comparison.
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7. Letting agent fees FAQ
Are letting agent fees legal?
Letting agent fees are legal for landlords. They are charged in exchange for services related to managing a property. A ban on letting agent fees for tenants can into play in June 2019. This stopped tenants being charged for certain fees such as viewing fees and charges for inventory checks.
What are average letting agent fees?
Average letting agent fees are usually between 8-12% of your first months rental income for tenant find services. Many agents now offer fixed fees for finding a tenant. These are usually between £100-£400. Letting agents charges between 12-18% of your month rent for fully managed services
Are letting agent fees subject to VAT?
Yes, letting agent fees are subject to VAT, if the agent is over revenue thresholds outlined by the HMRC
Are letting agent fees negotiable?
Many agents will offer discounted prices depending on your situation. A common way to negotiate better deals with letting agents is when you have multiple properties to offer. In addition, if a local rival agent is offering a better fee, that can be used to your advantage.
What fees can letting agents charge?
Letting agents can charge landlords fees for the initial service a landlord requires (i.e. tenant find or managed services). However landlords can can also be charged additional fees for inventory checks, cleaning services, repair costs, tenancy renewals etc.
** Letting Agent Fee Calculator: THE CALCULATION MECHANISM
The costs can be daunting at first, but if you want to alleviate a lot of the stress of being a landlord, a letting/property agent is the way to go.
Remember, although the letting agent fee calculator has shown you fees on a yearly basis, you’re likely to have the same letting agent for years and years.
So effectively you can multiply your letting agent fees (and potential savings) by 4,5,6 or even 10 years!
The letting agent fee calculator is based on average letting & property agent fees, taken from various sources.
We looked at fees of the largest letting agents & property managers in the UK (agents are obliged to publically post their fees).
We also researched into numerous blogs available on the web.
Finally, we have our own properties being managed by letting agents, so are very accustomed to fees!
To work out how much Rentround can save landlords in letting agent & property manager fees, it was quite simple.
We took 5 of the most popular postcodes for rental properties in the UK.
We then plugged these into Rentround. Using our own database, we took the average of the 3 best priced letting agents & property managers.
This enabled us to then compare average fees in the UK vs potential saves on Rentround.
This valuable inclusion in the letting agent fee calculator clearly demonstrates the benefit of landlords using Rentround.