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My partner and I are finally buying a new home with more space and a garden, having struggled in our one-bedroom flat during lockdown.

We are in the fortunate position of being able to buy without having to sell and we have therefore decided to keep our flat as an investment and rent it out.

We are considering using a letting agent to find a tenant, but are undecided over whether we want to outsource the day-to-day management as well.

We spoke to a local letting agent, but they charge 20 per cent of the monthly rental income in fees for their full management service, which seems like a lot.

A friend of ours has suggested we would be mad to use an expensive high street agent, and recommended we use a cheaper online service to rent it out and manage the property ourselves.

We like the idea of a fully-managed service removing all the stress, but want to know if there are other advantages and whether 20 per cent is too much. 

And if we opt to manage it ourselves, what options are out there and what else do we need to consider? Via email

Ed Magnus of This is Money replies: Becoming a buy-to-let landlords can be a time-consuming and demanding investment.

On top of finding suitable tenants, you have to consider other factors such as regulations and safety checks, maintenance costs, void periods and rent collection to name just a few.

Using a letting agent enables landlords to take a step back and allow someone else to manage everything on their behalf.

it can come at a considerable cost, on top of what they are already paying in tax and maintenance. 

Traditional high-street letting agents can charge anywhere between 5 and 25 per cent of the monthly rental income depending on the company, the location and the service level on offer. 

Broadly, there are two service levels available. As the name suggests, the cheaper 'let only' service is where the agent finds the tenants, moves them in and then hands everything back to the landlord.

You should typically expect to pay between 5 and 8 per cent of the monthly rent for this service, according to the property forum, Property Hub.

The 'fully managed' service is where the agent takes care of everything during and letting process and the tenancy, including rent collection and organising repairs. This should typically cost between 8 and 15 per cent of the rent, according to Property Hub.

If you just want help with the lettings and moving in process, there are online options which are far less expensive. 

Online agents such as Open Rent, Mashroom, Howsy, and Upad all offer cheaper DIY alternatives to using the more traditional high-street agent.

Open Rent for example, offers landlords the chance to pay just £29 for three months of advertising on Rightmove and Zoopla, giving users the ability to handle viewings and enquiries themselves.

With some of these services, landlords can then pick and choose their level of involvement with pick-and-mix extras such as viewings packages and photography services. 

For example, Mashroom offers the choice of professional photography and floorplans for an additional £100 fee, and Open Rent includes tenancy referencing from £20 and contract drafting, deposit registration and initial rent collection for £49.

This is Money spoke to Zaza Oswald, head of Winchester lettings at high street estate agent Carter Jonas; Calum Brannan, chief executive of online letting agent Howsy; and James Wood, senior policy officer for the National Residential Landlords Association, for their advice on the matter. 

What are the advantages of using a traditional letting agent?

Wood replies: The main advantage should be having the peace of mind that a property is managed by an experienced professional who can ensure they meet their legal responsibilities.

This is not always the case though. It is important to check that the agent is up to date with the latest legislation, and has good reviews from other landlords and tenants.

Agents can be costly, but if the landlord does not have the time to manage the property themselves they are usually worth it. 

Oswald replies: A good letting agent will provide golden nuggets of insight, helping landlords to target the right demographic for a property and price rents correctly. 

They'll also often have a list of prospective tenants on their books, so they are in a great position to get the ball rolling even before the paint is dry and marketing photos available.

Managing a property can also be surprisingly labour-intensive, so it is also a question of time and expertise for the landlord.

Statistically, tenants tend to stay longer in professionally-managed properties - and it's often something that corporate tenants insist on.

What should a DIY landlord consider before going it alone?

Wood replies: If the landlord does not live in the area where their property is located, they should probably consider an agent. 

If they decide to manage the property themselves, they will need to be up to date on the latest legislation and will need the various tenancy agreements and documents. 

Documents such as energy performance, gas safety and electrical safety certificates are all legal requirements and landlords need these in place before the tenancy begins.

If they are taking a deposit, this must be protected in a Government-approved scheme within 30 days of receiving the deposit. 

Brannan replies: You need to assess the market and consider recent market trends to make sure you value the property correctly. 

Landlords should conduct an inventory report before the tenant moves in, to assess the property's condition and assist them with any claim that they may want to pursue against the renter in the event of any damage. 

The landlord also needs to decide how they will manage viewings, contracts, background checks and references on renters to ensure they're suitable.

You will also want a team of trusted tradespeople on hand to help you when there is a leaky pipe or a boiler on the brink.

You also need to think about how you will manage utilities. This is especially important during void periods, and can lead to lots of admin work if not managed effectively. 

Finally, don't forget to think about how you will be managing access to the property - as well as providing a set of keys to renters, you may need to retain a set for yourself to manage access for tradespeople or other circumstances. 

Verdict? 

Ed Magnus of This is Money replies: If you opt to use a letting agent, it's important to do your due diligence before signing up with one.

Word of mouth and online reviews will give you some peace of mind, but don't be afraid to pick up the phone and test how responsive they are to tenancy enquires.

If your heart is set on a fully-managed service, it would be wise to speak to at least a couple more letting agents to compare prices – you may find one that will charge much less.

You could also use the fees offered by other letting agents as a bargaining chip in haggling another agent down in price.

However, if you're comfortable with the demands on your time, the regulations and the hands-on involvement of being a DIY landlord, you could find that you save yourself hundreds if not thousands of pounds each year by using an online letting agent.

Other than just savings, there are also arguably some advantages of being a DIY landlord. 

Whilst letting agents often claim to handpick tenants on your behalf and will boast of responding rapidly to property maintenance issues, you are essentially forfeiting your ability to guarantee this.

Were your property to have an issue, such a leaking pipe, you may prefer to be in a position where you can respond rapidly to safeguard your investment, rather than relying on a third party. 

Furthermore, as a DIY landlord conducting viewings, you will likely meet any prospective tenants prior to a tenancy commencing, meaning you have a better understanding of who will be living in your property.  

Ultimately it will come down to how much you value your time, and your willingness to actively manage your investment. 

If you're short on time and would prefer a more laid-back landlord experience, it may suit you to opt for a fully managed service.