As a landlord, you are presented with two alternatives for managing your rental property. You can either take on the task alone or hire a company to handle it for you.
There are several perks to hiring a property management company, including maximizing your rental income, reducing vacancy time, and taking care of maintenance and repairs. But how much does it cost to hire a property manager? In this post, we will look at the rates and fees charged by property management companies.
Property Management Fees
Management fees can differ a lot depending on where you are and the company you are dealing with. However, property management companies generally charge a national average of 5-12% of the monthly rent collected.
That is a good starting point, but it fails to convey the whole story. That’s because it’s important to evaluate a company’s fees with what they offer. In other words, you should consider what you are actually getting for your money, not just how much it costs.
For most property managers, the fees they charge are used to pay for the expenses of marketing and advertising for new tenants, collecting rent payments, tenant screening and investigations, dealing with tenant requests and inquiries, processing maintenance requests and repairs, executing regular inspections, providing legal paperwork such as leases and notices of violation, and providing other administrative services. However, these and other services may or may not be included for all property management companies, so it’s best to carefully read the details and ask many questions before recruiting one.
Additional Fees to Consider
When taking into account the cost of a property management company, it’s worth remembering that they may charge either a flat fee or a fee based on a percentage of rent collected – along with extra fees for certain services. For instance:
- Leasing and Tenant Placement Fees: This fee is charged once and is usually the same as one month’s rent. This fee includes the marketing of your property, tenant screenings, and lease negotiations.
- Maintenance Fees: Maintenance charges can cover everything from repairing a leaky faucet to changing a roof. You should ask your management company how they assess maintenance fees and whether there is a cap on the amount they charge for every fix.
- Tenant Late Payment Fees: Property management companies may impose late payment fees when tenants neglect to pay their rent promptly. Late penalties are usually a percentage of the rent and differ by company.
- Advertising Fees: This fee covers photography for listing, digital marketing space, and printed ads. Advertising fees are occasionally charged on top of other expenses, so ask about that before agreeing to anything.
Some owners may feel uncomfortable about the concept of paying an individual to manage their rental property. Hiring a professional manager can be a smart choice, particularly if you place a high value on your time. The advantages of working with an experienced manager can significantly outweigh the cost, making it a financially sound choice eventually. A property management company will protect the value of your property and create a hassle-free rental experience. This is true whether you own one property or dozens.
If you want to know more about the perks of professional property management in Minnetonka or the surrounding area, Real Property Management Viking can aid you. Our staff knows a lot, we offer many services, and we have proven methods that can help you make money from your rental property. Contact us online or call us today! 612-230-3953
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
