The London rental market is booming, increasing the importance for London landlords to know what fees London letting agents are charging on average.
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.
So if you have a property in London, the below analysis may be useful for understanding average fees letting agents are charging.
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.
There is ample data to compare fees of letting agents and work out how much you should be paying and therefore should be saving.
Taking a sample of 7 agents close to central London and all 5 star rated on Rent Round, below are some of the costs for tenant find only services:
|Letting Agent||Fee for tenant find|
|Home Allures Properties||£400 one off|
|Maida Vale Open House||£200-400 one off|
|Base Property Specialists||6-10%|
|Century 21 (Fieldcrest)||6-10%|
|Greater London Properties||6-10%|
Clearly you have a variety of agent types and fee mechanics. Lettingaproperty, an online agent, charges between £100-200 as a one off fee for finding a tenant, while Home Allures Properties, a traditional agent, charges around the £400 mark.
Then you have your more traditional letting agent fees, with Marybow Property, Base Property Specialists & Century 21 both charging a % of monthly rental income
You will need to read into the exact service on offer, for some of the lower one off fees, a landlord may need to conduct the viewings themselves
According to HomeLet, in London the average rent paid by tenants is £1,665 a month.
So if you’re a landlord with an average property in London, charging the average rent, you’re likely to pay £100-400 one off in letting fees for your London property.
Alternatively if you opt for a % of your monthly rent, let’s say from Century 21, as you’re looking at 10% of your annual rental income, you’ll be paying £1,998.
Fully managed letting fees in London
Some landlords may be looking for more comprehensive services from a letting agent, i.e. fully managed.
This type of service will include duties such as rent collection, property inspections, legal drafting and maintenance & repairs.
Most letting agents offer this service but it will usually require a higher letting agent fee in return.
Landlords need to weigh up whether they can a. afford the extra fees and b. conduct activities themselves (although they may not wish to regardless).
Fully managed services are often opted into by landlords with time contstraints or those that own large portfolios.
Using the same agents as above, the fees for fully managed are below:
|Letting Agent||Fee for fully managed|
|Home Allures Properties||1-5% pcm|
|Maida Vale Open House||6-10% pcm|
|Marybow Property||6-10% pcm|
|Base Property Specialists||11-15% pcm|
|Century 21 (Fieldcrest)||11-15% pcm|
|Greater London Properties||6-10% pcm|
Therefore taking the average rent charged by landlords, £1,665 a month, we can estimate the average letting fee charges in London for fully managed services.
For the lower range, the fully managed letting fee a landlord in London will be paying is £999 per year. On the more expensive side, landlords will be paying £2,997 a year.
Guaranteed Rent Fees
This type of service offers landlords the safeguard that they’ll receive their rental income, should the tenant fall behind rent or refuse to make payments altogether.
A landlord can get a guaranteed rent insurance policy themselves, for instance Endsleigh offer quotations through their website.
Landlords can buy these types of insurance policies through their letting agent, but adding this additional service will increase letting fees.
Average letting agent fees in London: Your property
If you have a property in London you’re looking to rent out, but not quite sure which letting agent to choose, you can compare letting agents around your postcode for free using Rent Round.
Landlords just need to enter their postcode, property type and what type of services they need from a letting agent.
After which a breakdown of agents in the properties area, along with fees, ratings and regulatory associations will be shown.