For landlords · 6 min read
The real cost of renting out a property in the UK
Beyond the mortgage, the recurring costs of letting a property in England are agent fees (typically 8–15% of rent plus VAT if managed), compliance certificates (gas safety annually, EICR every five years, EPC every ten), landlord insurance, maintenance, void periods and tax on rental profit. For a £1,500 pcm property, non-mortgage running costs commonly land between £2,500 and £5,000 a year, and the largest single controllable line is almost always the agent's commission.
Frequently asked questions
How much does it cost to rent out a property in the UK?
Excluding mortgage and tax, running costs commonly fall between £2,500 and £5,000 a year on a £1,500 pcm property: agent fees, gas safety and EICR certificates, insurance, maintenance and void periods. Agent commission is usually the largest single controllable cost.
What are the legally required certificates for a rental property?
A gas safety certificate renewed annually where there are gas appliances, an EICR at least every five years, and a valid EPC (minimum band E for most lets, valid ten years). Smoke alarms are required on every storey and carbon monoxide alarms in rooms with a fixed combustion appliance.
Do I need landlord insurance?
Standard home insurance generally will not cover a tenanted property, so landlord insurance is normally required, and your mortgage lender may insist on it. It typically covers buildings, property owners' liability and optionally loss of rent.
How much should I budget for maintenance?
A widely used planning figure is around 1% of the property's value per year, though older properties usually cost more. Budget separately for remedial work arising from an EICR, which can be unpredictable.
Is rental income taxable?
Yes. Rental profit is taxable and must be declared. Individual landlords now receive a 20% basic-rate tax credit on mortgage interest rather than deducting it as an expense. Tax depends on your circumstances — speak to an accountant.
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