How much do letting agents in Edinburgh really cost?
If you think that your agent’s ‘full property management’ fee covers everything, you are more than likely to be wrong – most agents charge at least a marketing fee on top of the full management commission. Some letting agents in Edinburgh and beyond may entice you with their low fee (like 5% or the rent), but will introduce fees (sometimes justifiable and reasonable, sometimes far from it) for literally anything that is a little bit out of scope of day-to-day property management. When choosing or researching Edinburgh letting agents, any landlord should delve into their Terms and Conditions and check their fees or schedule of charges. Quite often seemingly cheap letting agents may turn out quite expensive!
So, what types of fees Edinburgh landlord may face?
Full Management fee : It is usually 10% of the rent + VAT, but in some cases it may be as low as 5%+VAT (online or hybrid letting agents, letting agents operating ‘from their living rooms’ etc.) or as expensive as 15%+VAT in cases of agents operating in remote and sparsely populated areas of Scotland where a return trip to a property may take a few hours.
Marketing fee: Putting the property on the market may incur significant costs and it includes installation and removal of To Let Boards, advertising on major property portals (Zoopla, Letting web, On The Market, Right Move, City Lets) and agent’s website. Marketing fees start from around £100 + VAT, but some more expensive letting agents charge even £300+VAT whenever any property is put on the market. Some agencies do not charge any marketing fee if they do not manage to secure a suitable tenant.
Void management fee: Such charge may be triggered if the property is not tenanted long term.
- Termination fee: Sometimes called ‘Exit Fee’. At times it amounts to the remaining property management fees, which seems fair, but some agents may claim a full one month’s rent when you decide to take your property back or change your letting agent.
- Change of agent fees: Such fees may be payable on top of the Termination Fee for transferring documents, certificates, inventory and all other property details to another letting agent.
- Insurance claiming fee: As insurance remedials tend to be out with the scope of the regular residential property management, some letting agents charge a fee (usually around 10% of cost of works). Such fees vary, and some letting agents do not facilitate insurance claims at all.
- Fee for out of scope works: Regular property maintenance covers simple repairs and remedials, but major refurbishments or big communal works (like roof repairs and replacements) are not considered to be within the regular property maintenance. If your agents are willing to carry out communal repairs or bigger projects, they may want to charge a fee, usually 10% of cost of works. Other works may be billed on an hourly basis.
Fees bordering on ridiculous…
- Serving of notices: Some letting agents may charge a fee every time they send any notice (for example a notice to quit) or instruct sending a notice. Certain notices are costly, for example carried out through Sheriff Officers, so some agents may only charge you for the outlays only.
- Deposit dispute processing fee: Deposit disputes are very time consuming – complicated cased may require a few day’s work to process, so some agents may try to impose a charge to process a deposit dispute. We have heard of agents charging for processing a simple deposit deduction!
- Visits other than inspections: Regular property inspections are part of the full property management, but what happens if you need to send surveyors to value your property or if you do not want to use agent’s contractor, but need them to give access to your own gas engineer or any other tradesperson? Some agents will charge a fee if their letting agent has to let somebody into your property.
Check the landlord agreement before you commit
Our advice is to check Terms and Conditions first, and then ask questions. There are agents who have quite lengthy schedule of charges, but do not enforce fees. You can always try to negotiate with your chosen letting agent to get rid of fees which sound unreasonable or are excessive