More landlords are considering managing their rental properties themselves as growing compliance demands and rising letting agent fees prompt them to review their arrangements.
According to August’s Landlord Survey, 65% of landlords have changed how their properties are managed over the past two years, with compliance now the leading reason for making a change.
The survey found that 27% of landlords had stopped using a letting agent and moved to self-management, while 26% had chosen to appoint an agent. A further 12% had switched to a different letting agency.
When asked why they had changed their arrangements, 27% pointed to the growing complexity of legal and compliance requirements. This was followed by a desire for greater control (22%), dissatisfaction with the service provided (20%) and management fees (14%).
The cost of professional management is also a concern. Among landlords who pay for these services, 58% are charged at least 11% of their rental income, while almost one in ten pay more than 15%.
For a landlord with five properties each generating £1,000 in monthly rent, a management fee of 12% would amount to £7,200 annually.
Despite the number of landlords currently using agents, the survey suggests a further shift towards self-management. Around 69% expect to manage all their rental properties themselves within the next two years. This includes 58% of those who currently rely on a letting agent.
Growing Compliance Responsibilities
The increasing complexity of landlord regulations is another factor influencing these decisions. The Renters’ Rights Act and Making Tax Digital (MTD) are adding to the administrative responsibilities that property owners must manage.
The survey found that 75% of landlords who fall within the scope of MTD expect the new requirements to take at least four additional hours each quarter. Around 41% estimate they will spend between four and eight extra hours, while 34% expect to spend more than a full day. Only 6% believe the process will take less than an hour.
Based on the four quarterly updates required each year, this could mean between 16 and 32 additional hours of work annually for most affected landlords. Around a third expect to spend even longer.
Other concerns highlighted by the survey include rental void periods and mortgage rates, both mentioned by 19% of landlords. Tax was another concern for 13%, while just 2% said they had no particular worries.
Richard Samuel, chief executive of August, said landlords had faced increasing regulatory responsibilities over the past decade without a clear understanding of the time involved.
He explained that quarterly digital tax reporting makes these additional demands easier to measure, potentially taking landlords days rather than minutes to complete. When combined with the proposed landlord database, ombudsman requirements, periodic tenancies and additional paperwork for rent increases, smaller landlords may find themselves managing a significant compliance workload without dedicated staff.
Samuel believes some landlords will choose to pay an agent to handle these responsibilities, while others may leave the sector. Those who remain could increasingly rely on technology to manage their administrative and compliance tasks.
The findings suggest that landlords are reassessing whether using a letting agent still offers value, particularly as regulatory requirements become more demanding. For many smaller property owners, the choice between self-management and professional support may increasingly depend on the time and cost involved.
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