Good letting agents will offer a range of services, from tenant sourcing to day-to-day property management.
The problem is letting agents are not regulated, so anyone can start up a letting business without any professional qualification or training.
One issue is handling client money – this includes deposits and rents collected for landlords – as letting agents with poor business skills or who are just plain crooked often collect the cash and then disappear leaving their customers out-of-pocket.
What to look for in a letting agent
To minimise the risk, look for a letting agent who can show they take protecting client cash seriously:
- Professional accreditation – the two main money protection schemes are run by SafeAgent and the Association of Residential Letting Agents (ARLA) [Links open in new windows]. Only letting agents verified by these schemes can advertise the logos. Always check the ARLA or SafeAgent web sites to confirm membership – some letting agents use the logos but are not members.
- Customer service – Phone and email to see how long the staff take to reply and whether they are friendly and helpful.
- Services offered – Services should range from finding a tenant to managing a property day-to-day, which includes rent collection and dealing with repairs
- Market coverage – If you want to rent to a family, student letting specialists are no good, so make sure the agent and the property are a good match.
How much to pay a letting agent
Fees and commission are always important to consider for a letting business – but the cheapest letting agent is not necessarily the best.
It’s better for landlords to list the services they want from an agent and then shortlist two or three that match the bill.
Then look at the price to see if they offer value for money.
The commission charged by letting agents can vary between neighbourhoods – from around 7.5% to 15% or more of rents collected.
Some agents also surcharge the cost handling repairs by charging a 10% fee of the total cost of work.
Many will negotiate fees – especially if a landlord has a portfolio of several properties needing management.
