Property management companies typically charge a monthly fee of 8 to 12% of the monthly rent. If the rent of your rental property is. As a base, you expect to pay a typical residential property management company between 8 and 12% of the monthly rental value of the rental property, plus expenses. Property managers calculate commercial property rates a little differently, so be sure to ask for a breakdown of the fee structure if you're hiring commercial property help. This post will discuss the types of property management agreements, the additional fees that may apply to each management style, what you should consider when entering into an agreement with a property management company, and how to decide if hiring a property manager is the right decision for you.
Managing a larger property involves more work than managing a smaller rental property, so the fee charged will be higher. Some property management companies offer a comprehensive suite of services, including maintenance, rent collection, and tenant selection, while others may provide only basic services. Some companies charge a higher monthly administration fee, but it can be more inclusive, so don't be intimidated by a higher initial fee until you understand what's included. In the long term, monthly management fees aren't as important as the communication between you and the manager and the quality of the service your manager provides. If you break your property management contract early, you'll often have to pay an early cancellation fee.
It may be worth paying for multi-unit properties, while the fee may not be worth the cost of a single-family home. Property managers can manage all types of investment properties, including single-family homes, multi-family properties, commercial properties, and even vacant properties. The more properties a landlord manages, the more bargaining power they have with respect to rates. It's also worth noting that many property managers set their rates according to the percentages of a property's monthly income, but some companies charge fixed fees instead.
Property management companies usually charge a percentage of the income collected or a fixed monthly fee depending on the tasks delegated to them and the associated time and resource requirements. Erin Eberlin is an expert in real estate and landlords, covering rental management, tenant acquisition and real estate investment. A landlord may only want to delegate certain tasks and functions to a property manager while remaining very practical in other areas. In some cases, property management charges may include costs that are passed on to you, especially if the company's percentage-based rates are lower than average.
An important detail of your contract will define whether the administration cost is based on the rent charged or based on the rent charged or not.
