A letting agent is an individual who facilitates an agreement between the landlord and tenant to ensure a smooth and easy renting of a residential property. They arrange, monitor, coordinate and manage property letting to tenants for landlords. Letting agents generally work for a letting agency which will charge the property owner a commission for their services – usually a fixed percentage of the annual rent. While there are many agents that deal exclusively with lettings, letting agents often work under the umbrella of an Estate Agent because collaborations exist between both professions.
The ideal method for locating a letting agent is personal recommendation. Landlords in need of letting agents for their property can find out from people with positive reviews about their experiences dealing with local agents.
When considering letting agents, membership of a reputable professional organisation such as the Royal Institution of Chartered Surveyors (RICS), Association of Residential Letting Agents or the National Association of Estate Agents. Letting agents under such organisations are bound by a code of practice that ensures good service.
The job of a letting agent is primarily to find suitable tenants for a property on behalf of the owner. To start with, the agent first carries out a free property valuation to determine its potential income. After both landlord and agent agree on an appropriate rent, the property will then be advertised by the letting agent.
Property advertisement by the agent is done in different ways – a photo of the house with associated important details in the agent’s office, an ad in the press (local or national) or property website. Interested individuals will be shown the property and offers made will be communicated to the property owner.
Letting agents function as a go-between in negotiations between prospective tenants and the landlord before the final signing of a tenancy agreement. They are in charge of providing the legal contract to be signed by both parties. Sometimes the landlord may not visit the property or meet face to face with prospective tenants, leaving the letting agent to handle it all with necessary communications done over the phone.
Normally, fees are a percentage of the rental income for the letting term, beginning from 10 percent of the agreed rental price. The percentage covers the costs incurred by the letting agent while marketing the property, finding and vetting suitable tenants, getting references and preparing a comprehensive inventory and a tenancy agreement.
Letting agents charge more for a full property management service – from 15 percent of the rental price and up. This service includes organising of credit checks, collecting of rent, bill payments on the property, regular inspection of the property and carrying out needed maintenance work.
Another option for landlords is to opt for property management agent if letting is only done on a short term service. The other services can therefore be negotiated as needed with either a letting or a property management agent.
In England and Wales, typical letting agent fees to tenant may include:
As a matter of fact, some landlords do not see the need to hire letting agents and rely on word-of-mouth advertising to get tenants. Letting from a landlord or an agent doesn’t change the legal responsibility concerning repairs, safety, deposits or contracts. Renting from one or the other therefore shouldn’t really matter. However, renting directly from landlords is likely to cost less as they generally do not require any administration charges. On the other hand, most landlords do not live near their properties and tenants can more easily get in touch with a letting agent in case of a problem as they have an office through which they can be reached.
Whether renting from a landlord or from a letting agent, tenants need to verify reliability of the individuals to avoid renting an unsafe property or having to pay high and unnecessary fees on a rental property.