What is a letting agent?
Letting agents are responsible for managing properties on behalf of private landlords. Private landlords pay letting agents to help ensure that their legal responsibilities to tenants are met. Letting agents are therefore contractually obliged to put landlords’ best interests front and centre.
Good letting agents can help make the lives of private landlords easier by freeing up their time by carrying out tasks such as rent collection and property inspection to make sure everything is in order.
When searching for a letting agent it’s a good idea to ensure that they belong to a professional body such as the Association of Residential Letting Agents (ARLA), UK Association of Letting Agents (UKALA) or National Association of Estate Agents (NAEA) as they’ll need to operate to specific rules and regulations and give landlords more protection. It’s important to keep in mind that any legal liability always lies with the landlord in the landlord-letting agency relationship – even if the mistake lies with the letting agent.
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Services and Costs
A let-only service is when the letting agent markets the property, offers advice on setting rent levels, collects deposits, finds tenants, carries out reference and credit checks, draws up tenancy agreements and conducts inventories. However, as soon as the tenancy begins, the day to day management of the property and subsequent relationship with the tenant is the responsibility of the landlord.
Under a rent-collection service, letting agents are responsible for finding tenants and collecting rent from them – as well as chasing up any late payments – each month. However, all other aspects of the rental relationship are the responsibility of the landlord.
As the name suggests, a fully-managed service is when the letting agent takes care of all aspects of the rental property. This includes everything from marketing and finding tenants, collecting deposits, establishing a tenancy agreement, carrying out inventories and moving tenants in, to collecting rent and chasing up late payments, undertaking property inspections, arranging maintenance as well as dealing with tenancy requests, rent increases, tenancy renewals and contracts ending.
For a let-only service, agents will charge a one-off fee, which is usually around 5 to 8% of the annual rent or a one-off fee of between £300-£600. Full-management fees can cost anything from 10% to 15% of the rent, which you can pay in monthly instalments.
Always double check that you’re fully aware of what services you’re paying for, as some letting agents charge extra for tasks such as inventories, rent reviews and tenancy agreement renewals. And, if you think the fees are too high, don’t be afraid to haggle to get the most cost-effective deal.