The rental market is constantly evolving, and landlords must decide whether to manage their properties independently or hire a letting agent.
Despite the convenience and expertise offered by professional agents, nearly half of landlords still opt to handle things themselves.
This is particularly true of landlords with just one or very few homes. Government data shows that landlords with 5+ homes are far more likely to use an agent to manage their portfolio.
But are smaller landlords exposing themselves to increased risks, especially as the new Renters Rights Bill comes into law?
Cost savings a key factor in self-managing investment properties
Landlords often choose to self-manage rather than use letting agents for several reasons. The main factor is cost, as agent fees can typically take 10–17% of rental income.
Many also prefer having direct control over tenant relationships and property decisions. DIY platforms are making advertising, vetting and contracts easier without professional help. For landlords with just one or two properties, managing the workload themselves is often seen as more manageable.
The reality of self-managing your properties
When I hear that 50% of landlords still choose not to use a letting agent, I don’t scoff - I get it. Because I used to be one of them.
For many landlords, especially those with a single buy-to-let property or a couple of family homes, the case against using an agent seems straightforward: it seems expensive, it’s less personal between you and your tenants, and “how hard can it be?”
But here’s what I’ve learned the hard way, particularly in the HMO sphere.
Self-managing may seem like saving money - but often it’s just delaying the costs. And in some cases, the reality of getting it wrong can far outweigh the perceived savings.
Self-managing requires time, effort and knowledge of the 169 Acts and 402 Regulations that govern the private rented sector. Choosing the right letting agent can offer security and peace of mind, protecting landlords from making the most common, and often very expensive, mistakes.
Letting agents can be especially invaluable for inexperienced landlords or those with larger portfolios, HMO properties or simply busy schedules.
In reality, good management preserves profit, rather than eating into it.
A landlord’s desire to maintain control over their tenancies can also be a double-edged sword. Letting a property, owning a portfolio or running a HMO isn’t just about being available to fix a leaky tap - it’s about managing relationships and, oftentimes, disputes.
The growing importance of letting agents under the Renters' Rights Bill
The Renters' Rights Bill is set to become law in the next few months and will bring significant changes to the rental market, making compliance more crucial than ever.
The new bill introduces stricter obligations on landlords, covering everything from tenancy agreements to property safety standards. The margin for error is shrinking, and even minor, accidental mistakes could result in hefty fines.
With penalties for persistent breaches skyrocketing to an eye-watering £40,000, rent repayment orders increasing to two years’ worth of rent and the possibility of civil and criminal prosecutions, landlords must ensure they are fully aligned with regulations. This shift makes using a letting agent more valuable than ever before.
With stronger legal protections for tenants, landlords must be careful in handling disputes, evictions and rent arrears. Letting agents are skilled negotiators, familiar with the correct processes to avoid costly legal battles. Their expertise ensures that landlords can resolve issues efficiently and within the law.
While self-managing may have been feasible in the past, the increased risks and financial penalties make hiring a qualified letting agent a smart safeguard. Their knowledge, experience, and legal expertise could mean the difference between a smooth rental operation and costly legal trouble.
The line between passive income and full-time responsibility blurs quickly. The reality is: what seems manageable at first can quickly become overwhelming - especially as compliance standards grow more complex year by year.
I used to be a DIY landlord, adamant that I could go it alone. Today, I run a vertically integrated property business providing services to landlords like myself, because I realised it wasn’t about saving money - it was about building a model that works, legally, operationally and financially.
Letting a property is so much more than just the collection of rent. Landlords need, more than ever, a trusted partner who understands the complexity of private renting obligations, anticipates the risks and raises the bar.
Alex Barbouris is Founder of Babouris, a multi award-winning leader in co-living and real estate investment in Cambridge; Julie Ford has 30+ years’ experience in property and housing law, as a former lettings business founder, industry judge, media commentator, mediator and expert witness.