bric wall with lighting from left and Letting Agent's Fees 2021 Review
Here’s our review of letting agents’ fees in the Milton Keynes area for 2021. There are several factors affecting the wide-ranging results we discovered for tenant find, rent collection, and fully managed services. 

Background to letting agents’ fees 

In June 2019 new rules were introduced to prevent landlords and letting agents in England charging a range of fees to tenants. The rules were extended to existing tenants in June 2020. 
 
This has affected the fee structure for many letting agents and, a year on, the picture is still confusing for landlords. Many agents have changed the services they offer and have added new charges that landlords must pay. Some agent's fees have increased more than others, but landlords will need to check what is included in the service provided. At Letting Genie we have maintained our service levels and pricing structure across the board. 
 
Assured shorthold tenancies (ASTs), student accommodation, and licences are all affected by the tenant fee ban, although company lets and non-assured tenancies are exempt. 
 

Prohibited fees to tenants 

The Tenant Fees Act (TFA) prohibits fees on almost everything but allows some permitted fees. The restrictions include payments to most third parties. 
 
guarantor forms 
credit checks 
inventories 
cleaning services 
referencing 
professional cleaning at the end of the tenancy 
administration 
insurance 
gardening. 
 

Permitted fees 

Allowable charges include holding deposits, rent, security deposits and charges for defaulting on the contract, although they are subject to additional restrictions as part of the legislation. 
 
Landlords can require their tenants to use a specific utility or communications provider and can charge for changing tenants, varying the tenancy, or allowing tenants to vacate the property early. 
 

Artificial rent levels 

Landlords or their agents can’t set rent at a higher level for the first period of a tenancy and reduce it later. This is intended to prevent any attempt to offset the ban on fees through an artificially higher rent for the initial period. 
 
However, a higher rent than normal would be allowed if it applied to the whole tenancy. For example, a landlord might increase the rent if a tenant wanted to keep pets. 
 

Holding deposits 

Holding deposits are limited to a maximum of one week's rent and they must be repaid if the tenancy doesn’t go ahead. 
 
Landlords have 15 days to decide whether to accept a tenant once a holding deposit is taken, although this can be extended if both parties agree to another date. 
 
Once a decision is made, the applicant must be notified within seven days, setting out whether the holding deposit will be refunded in full or whether any of it will be retained. 
 

Milton Keynes Letting Agents’ fees 

Of those letting agents in the Milton Keynes area that publish their fees online, we discovered wide variations in the fees for tenant find, rent collection, and fully managed services. We have summarised a selection of them below. 
 
If, as a landlord, you decide to work with a letting agent it’s important to check what is included and excluded from your agreement with them. 
 
For example, some agents include property visits during the tenancy in their fees whilst others charge for this separately. Your statement of income and expenditure for HMRC might also be chargeable. 
 
Give special attention to clauses concerning tenancy renewals for existing tenants and the implications of ending your agreement with your letting agent during the tenancy or at the end of a specified period. 
 
If you are considering a fully managed service, check whether an administration charge will be made for any work needed on your property. 
 
Note: Where applicable, VAT must be included in the published price. 
 
Tenant find fee 
Tenant find and rent collection  
(% of monthly rental) 
Fully managed fee  
(% of monthly rental) 
Letting Genie - local  
business 
£495  
£250 set-up fee and 7.5% 
£250 set-up fee and 10% 
Agent 1 - regional chain 
£500  
£475 set-up fee and 7% 
£450 set-up fee and 12% 
Agent 2 - local chain 
£396 set-up fee and 12% 
£396 set-up fee and 15% 
Agent 3 - local business  
with London office 
60% of first month’s rent  
(minimum fee of £540) 
9.60% 
£420 set-up fee and 12% 
Agent 4 - local branches 
£300  
13.20% 
Agent 5 - local business 
£270 set-up fee and half a  
month’s rent plus VAT  
£270 set-up fee and 10.8% 
£270 set-up fee and 14.4% 
Agent 6 - local business 
£250 set-up fee and 12% 
Agent 7 - regional chain 
£390 set-up fee and 9.6% 
£390 set-up fee and 14.4% 
Agent 8 - local business 
One month’s rent with a  
minimum fee of £540 including VAT 
£360 set-up fee and monthly fee of  
£84 to £240 depending on rental value 
Agent 9 - local branches 
£390 set-up fee and 9.6% 
£390 set-up fee and 14.4% 
Agent 10 - local branches 
£600  
£90 set-up fee and 9.6% 
£190 set-up fee and 14.4% 
If you are considering buying a property to let, we’ll be happy to give you some advice about fees and your letting options, so please get in touch. 
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