Property management fees in London
January 1, 2025
London Property Management Fees: What Landlords Actually Pay in 2026
Last updated: January 2026
Being a landlord in London, one of the world's most dynamic and costly rental markets in the UK, comes with both opportunity and complexity. Many landlords immediately look to letting agents or property managers for help, but the fees can be substantial. If you're considering hiring a property management company, or thinking about whether you could manage the property yourself, understanding the fee structures is crucial.
In this article, we'll cover:
The typical fee structures (let-only, rent collection, full management, short lets)
What's usually included (and what's often charged as an extra)
How London pricing differs between inner/prime vs outer boroughs
Worked examples so you can compare quotes like-for-like
When self-managing makes sense (and when an agent still earns their keep)
Common fee types in London
When you hire a property manager or letting agent in London, fees can be broken down into several categories:
Monthly management / ongoing oversight (often 12–15% of rent)
Tenant sourcing / letting fee (usually 75–100% of one month's rent)
Renewal fees (£75–£150)
Inventory, check-in/out reports (£100–£300)
Maintenance mark-ups (often 10–15% on top of contractor invoices)
Vacancy management (ongoing charges while empty)
For a property renting at £2,500/month in Wandsworth, Hackney, or Camden, the ongoing management fee alone could be £300–£375 per month, before adding letting and renewal fees. In prime areas like Kensington, Chelsea, and Westminster, agents may charge closer to 20% for a more "hands-off" service.
Typical property management fees in London (2026)
Most London letting agents still price management as a percentage of rent collected, with separate one-off fees around tenant-find, renewals and check-in/out. As a rule of thumb, full management commonly sits around 12–15% of monthly rent in London, with higher pricing in prime postcodes or for more hands-off service levels.
Don't forget VAT
Many agent fees are quoted "+ VAT", which adds 20% to the agent's invoice. A "12% + VAT" management fee is effectively 14.4% of rent.
Worked example (what "+ VAT" means):
If your rent is £2,500 pcm and the agent charges 12% + VAT, the fee is £300 + VAT = £360 pcm. Over a year, that's £4,320 just for ongoing management.
Quick comparison table
Service | Typical London pricing | What it usually covers |
|---|---|---|
Let-only / tenant-find | ~75–100% of one month's rent (one-off) | Marketing, viewings, referencing, tenancy set-up |
Rent collection | often ~3–6% of monthly rent | Rent collection + arrears chasing (varies) |
Full management | often ~12–15% (higher in prime areas) | Rent + maintenance coordination + tenant comms + periodic inspections (varies) |
Short lets | often ~15–40% of revenue | Guest comms, pricing, turnovers, cleaning coordination (varies) |
Do fees vary by London borough?
Most agents don't publish "borough-specific" tariffs, because they price on a mix of rent level, property type, and service scope. What does change across London is the probability you'll be quoted at the top end of the range.
In practice:
Prime central (Kensington & Chelsea, Westminster) is more likely to sit at premium pricing because expectations are higher, properties are higher value, and "fully hands-off" service packages are more common.
Inner London (Islington, Camden, Hackney, Southwark, Tower Hamlets) often prices in the mainstream London band, but costs can climb if you have sharers, higher turnover, or more maintenance coordination.
Outer boroughs (e.g., Wandsworth and beyond) can be a touch more competitive on percentage, but the pounds-and-pence impact can still be large when rents are high.
Mini worked examples across London
Prime: Kensington flat at £4,000/month
15% + VAT management = £720/month = £8,640/year
Tenant find (100% of rent) + VAT = £4,800
First-year total: £13,440+
Inner: Hackney flat at £2,500/month
13% + VAT management = £390/month = £4,680/year
Tenant find (80% of rent) + VAT = £2,400
First-year total: £7,080+
Outer: Wandsworth flat at £2,000/month
12% + VAT management = £288/month = £3,456/year
Tenant find (75% of rent) + VAT = £1,800
First-year total: £5,256+
How the costs add up
Here's a hypothetical scenario for a flat in Islington renting at £2,500/month:
Management fee (13%): £325/month = £3,900 per year
Tenant find fee: £2,500
Renewal fee: £120
Inventory/check-in/out: £180
Maintenance markups: ~10% on works
Annual total: £6,800–£7,500+, which can be 25% of annual rent if you have tenant turnover.
What does "full management" actually include?
"Full management" sounds comprehensive, but the detail lives in the terms of business. Typically, the monthly fee covers rent collection, day-to-day tenant communications, and arranging routine repairs. Where landlords get stung is on extras: renewals, check-in/out, and project management fees for larger works.
For example, some London agencies apply an additional project management or admin fee on bigger repairs or refurbishments, especially above a threshold.
Before you sign, ask for the fee schedule in writing and confirm:
Whether renewal fees apply
Whether there's a maintenance mark-up
Whether major works attract a separate admin/project management charge
Whether you pay anything while the property is vacant
Published London fee examples (for context)
To show what "premium" can look like, some large London firms publish headline percentages in their terms. For instance, Savills' residential lettings terms (January 2026) include an option priced at 20.4% of total rent for letting, renewal, rent collection and management (subject to minimum fees).
This doesn't mean you should pay 20%—but it's a useful benchmark for what "full-service, prime market" pricing can look like, and why you must compare quotes on a like-for-like basis (what's included, what's extra, and whether VAT is added).
Short term lettings
Short term letting can boost headline income, especially in tourist-friendly areas in London. However, this comes with significantly higher management demands including cleaning, guest turnover, 24/7 availability, and more wear and tear. Many letting agents either charge a higher percentage for short-term lets or don't offer the service at all. It's also worth noting that local councils are tightening rules around short stays, so compliance and licensing should be checked carefully.
Why self-managing is different
For many landlords, especially those with just one or two properties, the idea of handing away 12–20% of rent each month doesn't make sense.
That's where self-management comes in. Traditionally, it was difficult and time-consuming—chasing rent, handling compliance, and tracking paperwork. But with digital tools, landlords in Canary Wharf, Southwark, Clapham, or Tower Hamlets can now run their properties professionally without the high fees.
Modern landlord software platforms allow you to collect rent automatically via Open Banking, track compliance tasks and store documents like gas safety and licensing (vital in boroughs like Hackney or Southwark), and manage tenant maintenance communication in one place. You can handle check-ins, move-outs, and reminders without extra charges, and avoid hidden mark-ups on maintenance by choosing your own contractors.
The key benefit is control. You decide which tasks to handle yourself and which to outsource on a case-by-case basis, rather than paying a fixed percentage every month regardless of workload. Property management apps have transformed what's possible for self-managing landlords.
The savings in real terms
Let's revisit that Islington flat example:
Annual letting agent fees: ~£7,000
With digital self-management tools, your software subscription is a fraction of that depending on your pricing plan, leaving thousands in savings while you stay in control
Even if you choose to outsource one-off jobs, like inventory checks, you're still keeping the monthly 12–20% fee in your pocket.
London hotspots where self-managing pays off
Wandsworth – growing professional demand, many single-let houses where management is straightforward
Hackney – high yields, younger tenants, frequent turnover and remember fees add up quickly if you use agents
Westminster & Kensington/Chelsea – prime rents mean even a 12% fee can run into thousands every year
Camden & Islington – popular with students and sharers, higher renewal/admin fees
Tower Hamlets & Canary Wharf – busy rental market, easy to let, but costly to outsource property management
Clapham & Southwark – active demand from young professionals, high turnover makes self-managing more rewarding
FAQs
Are property management fees charged + VAT?
Often, yes. Always confirm whether the percentage is quoted "+ VAT", because it materially changes the real cost.
Can agents charge tenants fees in England?
Most fees to tenants are banned under the Tenant Fees Act for assured shorthold tenancies, so many costs sit with landlords instead.
Are management fees tax-deductible?
They're commonly treated as an allowable expense against rental income, but rules vary by circumstance. If in doubt, check with your accountant. You can use our rental yield calculator to factor in all costs.
What's a fair full management fee in London?
A common band is around the low-to-mid teens as a percentage of rent, but prime areas and more hands-off service can push higher.
Final word
Property management fees in London are among the highest in the UK. Landlords can easily see 10–25% of annual rent disappear into management costs. But with the right digital tools, there's no need to choose between expensive agents and stressful DIY admin.
For more insights on managing your rental properties effectively, explore our landlord blog with guides on everything from setting the right rent price to understanding what UK landlords can expect in 2026. You can also check out our free landlord calculators and printable resources.
Remember to look at our global comparison of rent prices.
Author
August Team
The August editorial team lives and breathes rental property. They work closely with a panel of experienced landlords and industry partners across the UK, turning real-world portfolio and tenancy experience into clear, practical guidance for small landlords.
