Landlords can choose to handle the letting process themselves or alternatively, hand the responsibility over to a letting agent who can carry out the letting process on their behalf, usually for a set fee or percentage of the weekly, monthly or annual rent.
Letting agents can handle the whole letting process if required, including marketing the property, vetting potential applicants, taking professional photos, arranging viewings, providing floorplans as well as drawing up an inventory of items.
Online letting agents have increased in popularity in recent years and can provide a cheaper service owing to lower overheads and so in this article, we take a look at the pros and cons of using an online agent, how much they charge and whether there is a compromise in terms of the service that landlords receive.
What is an online letting agent?
An online letting agent works in a similar way to a standard high-street letting agent with one major difference; it doesn't operate from physical premises and so provides its services online and via centralised call centres. Online letting agents tend to offer a slightly stripped-back service when compared to their high-street counterparts and as a result, the fees are usually lower.
How do online letting agents work?
Landlords can choose between two types of online letting service and we provide details of each below.
Online-only letting agent
An online-only letting agent provides the cheapest solution for landlords, however, much of the work will need to be carried out by the landlord themselves. Landlords would be expected to take their own photos, create their own adverts, conduct their own viewings and even handle the negotiation process. The main draw of an online-only letting agent is that they provide the most cost-effective marketing solution, gaining access to several of the UK's biggest property portals such as Rightmove and Zoopla.
Online fully-managed letting agent (sometimes referred to as a 'hybrid' letting agent)
Landlords can opt for a managed online letting service that offers a hybrid solution using online technology combined with services provided by local letting agents. Most hybrid letting agents are able to offer a fully managed service, including hosted viewings, professional photographs and regular inspections, however, as these services often require the expertise of local letting agents, fees will be much higher.
Online or high-street letting agent: Which is best?
It is important to understand that the choice isn't simply between using an online or high-street letting agent and many landlords are choosing to combine both options, opting for a hybrid solution. In the table below we compare the three most popular types of letting agent and explain what you should expect to receive with each service, as well as the approximate cost.
Online-only letting agent vs fully managed online letting agent vs high-street letting agent
|Online letting agent||Fully managed online letting agent||High-street letting agent|
|Free listings||Sometimes offered||No||No|
|Tenancy Signup||Usually included||Included||Included|
|Rent Collection||Usually included||Included||Included|
|Rent Negotiations||Not included||Usually included||Included|
|Property Inspection||Not included||Usually included||Included|
|Hosted Viewings||Not included||Extra fee||Included|
|Professional Photographs||Not included||Extra fee||Included|
|Typical cost||£50 - £150 total cost||£50 - £150 per month||Typical fees range from £1,500 to £2,500 per year (fixed fees + % of monthly rent)|
Pros and cons of using an online letting agent
- Low cost
- Access to people outside of standard hours online and via call centres
- Landlord retains more control over rental process
- Stripped-back service
- Extra fees for some services
- Cheapest option meaning more work for the landlord
What are the risks of using an online letting agent?
It is important to understand that using a high-street or online letting agent doesn't provide protection from liability for breaches of regulations and so the overall responsibility lies with the landlord. In an industry where there is a worrying lack of regulation, landlords would be wise to do their homework and ensure that the letting agent that they are dealing with is credible and reputable. There are a number of governing bodies and schemes in which letting agents are either required to or can choose to become members and these include:
- The National Approved Lettings Scheme
- The Association of Residential Lettings Agents
- The Property Ombudsman
- The Property Redress Scheme
- The National Association of Estate Agents
- Tenancy Deposit Protection Scheme
While memberships to some of these schemes are voluntary, membership provides assurance that your agent is being held accountable to a standard of excellence and is doing all that they can to safeguard you and your prospective tenants.
How much do online letting agents charge?
Fees vary depending on the online letting agent you choose. Some online letting agents - such as Mashroom*, OpenRent and 99 Home - offer an introductory free period where properties can be listed for between 5 and 30 days at no charge. Online-only letting fees are charged as a fixed cost and tend to range between £50 and £150 and fees for fully managed online letting services range between £50 and £150 per month. We provide a comparison table of the top online-only services below.
Compare the best online letting agent
Below, we have compared some of the most popular online-only letting agents in the UK. The letting agents in the table below specialise in low-cost lettings. Most charge additional fees for services such as referencing, photography, floorplans and safety certificates, although some of these services are included in some of their more expensive packages. The packages we have highlighted below are the cheapest online letting packages on offer and are heavily focussed on marketing properties to prospective tenants via online property portals such as Rightmove and Zoopla.
Cheapest online letting agent comparison table
|Mashroom||OpenRent||99 Home||I Am The Agent|
|Free listing period||30 days||5 days||7 days||N/A|
|Cost||£29 for 30 days listing||from £29 for 90 days listing||from £49 - one-time fee (until let)||from £89 for 28 days listing|
|Tenant Referencing||N/A||from £20 per person||£20 per person||£75 per person|
|Photography & Floorplan||£100||from £79||£149||£119|
|Energy Performance Certificate (EPC)||£70||from £69||£79||£65|
|Electrical Safety Certificate||N/A||from £69||£150||N/A|
|Gas Safety Certificate||£79||from £45||£79||£75|
|Inventory & Check in/out||N/A||from £85||£129||N/A|
Cheapest fully managed online letting agent
Fully managed online letting agents are good for landlords that are happy to take a back seat and allow the agent to handle the letting process from start to finish. Fully managed online letting agents work in a very similar way to high-street letting agents but with a little more flexibility. Packages can include referencing, safety certificates, inspections, rent collection and chasing of rent arrears and typical costs tend to be around £50 - £150 per month. Those who require the online letting agent to carry out the property viewings are likely to be charged an additional £300 on top.
Three of the best fully managed online letting agents include
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