If you are preparing to rent out a property, one of the first questions you may ask is how much letting agents charge. The answer depends on the level of service you choose. Some landlords only need help finding a tenant, while others pay for full property management. For self-managing landlords, fixed-fee online letting can be a much cheaper alternative to traditional letting agent fees whilst still achieving great results.

How much do letting agents charge landlords?

Letting agents usually charge landlords in one of three ways: a tenant-find fee, a rent collection fee or a full management fee. Tenant-find fees are often charged as a fixed amount or as a percentage of the rent. Full management fees are usually charged as an ongoing percentage of the monthly rent. The exact cost depends on the agent, the property, the rent and the level of service included.

What are the main types of letting agent fees?

Before comparing costs, landlords should understand what service they are actually paying for. A cheaper headline fee may only include advertising, while a more expensive service may include viewings, referencing, tenancy paperwork, rent collection or ongoing management.

1. Tenant-find fees

A tenant-find service is usually designed to help landlords advertise the property and find a tenant. This may include marketing the property, dealing with enquiries, arranging viewings, negotiating offers, referencing the tenant and preparing the tenancy agreement. Some agents include all of these steps, while others charge separately for extra services.

Traditional tenant-find fees cost upwards of £1,000 per property and may be based on a percentage of the rent. This is why many self-managing landlords look for a lower-cost way to advertise their property and set up the tenancy.

2. Rent collection fees

Some letting agents offer a rent collection service. This usually means the agent collects rent from the tenant and passes it to the landlord. Rent collection is normally cheaper than full management, but it is still often charged as an ongoing percentage of the monthly rent.

3. Full management fees

Full management is usually the most expensive letting agent service. It may include rent collection, handling repairs, dealing with tenant communication, arranging inspections, managing compliance reminders and supporting the landlord throughout the tenancy. This can be useful for landlords who want a hands-off service, but it may be unnecessary if you are happy to manage the property yourself.

4. Extra fees and add-ons

Landlords should also check whether any extra fees apply. These might include tenancy agreement fees, inventory fees, check-in fees, check-out fees, photography, premium advertising, compliance administration or deposit registration fees. The total cost can be higher than the headline price if key services are charged separately. Commonly, landlords pay £3,000 to £5,000 to their letting agent over the course of one tenancy.

What should landlords compare before choosing a letting agent?

When comparing letting agent fees, do not look only at the price. Look carefully at what is included, what is optional and what you still need to do yourself. This will help you compare the true cost of each option.

• Is Rightmove advertising included?
• Are tenant enquiries sent to you or handled by the agent?
• Who arranges and conducts viewings?
• Is tenant referencing included?
• Is guarantor referencing included?
• Is the tenancy agreement included?
• Is deposit registration included?
• Are there any extra add-on fees?

Is a letting agent worth the cost?

A letting agent may be worth the cost if you want a hands-off service, live far away from the property or do not want to deal with tenant enquiries, viewings or management. However, if you are a self-managing landlord and only need help advertising the property or setting up the tenancy, a traditional letting agent will be more expensive than necessary.

How can landlords reduce letting agent fees?

Landlords can reduce letting agent fees by handling some of the process themselves. For example, you may choose to manage enquiries and viewings directly, while using an online letting service for advertising, referencing and tenancy setup. This lets you stay in control while avoiding unnecessary high street letting agent costs.

1. Advertise on Rightmove: Use an online letting service to get your property in front of tenants.
2. Manage viewings yourself: Arrange viewings directly with applicants instead of paying an agent to do it.
3. Use fixed-fee pricing: Choose a service where the cost is clear from the start.
4. Only pay for what you need: If you do not need full management, avoid paying for it.
5. Set up the tenancy properly: Use tools that help with referencing, agreements, deposit registration and compliance.

What is the cheapest way to find a tenant?

The cheapest way to find a tenant is usually to manage part of the process yourself and use an online letting agency, such as letlaunch. This can be much cheaper than paying a traditional letting agent a tenant-find fee, while still helping you get your property seen by the best tenants.

With letlaunch, landlords can advertise their rental property on Rightmove from £49. If you want help after finding a tenant, the Full Tenancy Setup package is only £149 and includes comprehensive tenancy setup from start to finish (with no add-ons).

Why fixed-fee online letting can be better value

Fixed-fee online letting can be better value because the cost is clear and does not increase simply because your rent is higher. This is especially useful for landlords who are happy to conduct viewings and manage the property themselves, but still want online advertising and support with important tenancy setup steps.