How much do property managers charge?

How much do property managers charge? To figure out the cost of property management is
simple as, generally speaking, the industry has two styles of fees —a flat fee and a percentage
of monthly rent, typically ranging from 5 percent on the low side to 20 percent on the high side.
For example, if the fee is 8% and the monthly rent is $3,600, the property management cost
calculator gives the monthly cost as $288.

There are factors influencing the cost of property management per month. Location is obvious.
The services of a property manager in California’s San Francisco-Oakland Bay Area most likely
will cost more than in Las Vegas or Henderson, Nevada. The type and size of property also
matter. The fees on a condominium complex or apartment building will be higher than that of
single home rental. Lastly is the property’s condition. A turnkey newly built home will be less
expensive to manage than a fixer upper.

While the property management cost calculator uses simple math, choosing the flat fee model
or the percentage one can be a tough decision for a landlord. This is when big picture thinking
with eyes on the future is necessary. Some fees may seem not essential right now, but do you
see yourself handling an eviction down the line or answering charges that you have violated the
Federal Fair Housing Act?

Fee-related questions to ask when recruiting a property management company.

As with any business contract, make sure you get everything in writing.

1. What are your fees and what services are included?
2. How do you charge for services not covered by the fee? For example, serving a notice to
quit.
3. Is the fee based on amount of rent charged or actually collected?
4. Do you provide online rent payment and maintenance requests?
5. What is the company’s policy if rent is not paid or the lease is broken?
6. Is there a contract set-up fee for an initial property inspection or setting up
bookkeeping?
7. How often do you visit a vacant property, not counting showings?
8. Do you collect a leasing fee? If so, how much is it?
9. Do you keep a percentage of late fees? If so, how much?
10. For repairs and maintenance, do you have a network of vendors or an in-house crew?
11. Are there any markups to maintenance supply and labor costs? What are they?
12. How often do you conduct inspections? (A minimum of every six months is a good
guideline. Make sure a detailed report and photos follow inspections.)
13. Do you handle evictions or do you farm out the work?
14. How long have you been in business, how many properties do you manage, and may I
have three references?

Are property management fees negotiable?

Keep in mind that “You get what you pay for” really applies to property management
companies. Asking for a minor concession on your contract is acceptable (and may be denied)
but expecting the entire fee structure to be negotiated is not. Ask yourself why a management
company would be willing to do that. How many properties are in their portfolio? Are they
desperate for landlords to represent?

Any other questions?

Property management can be a minefield. If you are looking for more answers, call Place
Tenants at 800-886-1193 or email [email protected]

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