Property Management Fee Costs: What You Need to Know

There are two main ways that you, as a landlord, can manage your rental property. You can do it yourself or hire a company to do it for you. 

Maximizing your rental income, decreasing unoccupied time, and managing maintenance and repairs are just a couple of benefits of hiring a property management company. Yet, how much does it cost to hire a property manager? Here, we’ll take a closer look at the rates and fees charged by property management companies.

Property Management Fees

First, you should understand that management fees vary greatly based on the location and company. However, property management companies generally ask for a national average of 5-12% of the monthly rent collected.

That’s a great place to get started, but it doesn’t tell the complete story. That’s why you shouldn’t just look at how much it costs; you should also evaluate the value of the services provided by the company.

Fees charged by property managers generally go toward paying the expenses incurred in collecting rent payments, marketing and advertising for new tenants, conducting tenant screening and background checks, resolving tenant requests and inquiries, dealing with maintenance requests and repairs, executing frequent inspections, releasing legal paperwork such as leases and notices of violation, and other administrative responsibilities. These and other services may or may not be included in the contract with any given property management company, so it’s advisable to ask plenty of questions and read the fine print.

Additional Fees to Consider

When calculating the cost of a property management company, it’s best to take into account that they may charge either a flat fee or a fee based on a percentage of rents collected – plus extra fees for certain amenities. As an illustration:

• Leasing and Tenant Placement Fees: This fee is a one-time payment, usually similar to one month’s rent. This fee incorporates marketing your property, screening potential tenants, and negotiating the lease.
• Maintenance Fees: Everything from a leaky faucet to a damaged roof might be covered by your upkeep charges. Check with your property management company to see if they have a cap on the amount they will ask for each repair and how they assess maintenance fees.
• Tenant Late Payment Fees: Property management companies may ask for late payment fees when tenants forget to pay their rent on time. Late fees are commonly a percentage of the rent and vary by company.
• Advertising Fees: Charges for advertising incorporate listing photographs, print and digital ad space, and other promotional materials. Make sure you know about any additional advertising fees before making a final decision.

Some owners may be afraid to hire a management company to manage their rental property. If you place a high value on your time, hiring a professional manager could be the ideal option. The cost of hiring an experienced manager may appear high at first, but the benefits bring over time more than the cost of it. That makes it a financially sound choice. A property management company will keep the value of your property and establish a hassle-free rental experience. Whether you own one rental property or a hundred, this is relevant.

Real Property Management Genesis welcomes the opportunity to discuss the many benefits of professional property management with anyone in the Palmetto Bay area. With our seasoned staff, extensive services, and proven strategies, we believe we can help you transform your rental property into a profitable investment. Contact us online or call us right now! 786-744-5700