Being a landlord is not for everyone, and there are major pros and cons to it. The profession is a common stepping stone for those pursuing wealth. But there are of course some drawbacks to the trade.
Some of the best ways to increase the financial benefit of your rentals are by finding and collecting rents, followed by charging tenant fees for things like poor living conditions. If you plan on outsourcing this kind of activity in your business strategy, you’re going to need a property manager.
However, you need to know what you’re paying for. It’s not only beneficial to know what services you’ll be getting but how they’ll charge you too. Keep reading below to find out the answer to “what do property managers charge?”
What Do Property Managers Charge
Many property managers will charge a management fee in addition to any other fees that may be required. This can range from a few hundred dollars to several thousand dollars, depending on the size and type of property being managed.
This is typically a percentage of the monthly rent collected. For example, if your monthly rent is $1,000, a 10% management fee would be $100.
This will cover the cost of their time and expertise. A property manager’s job is to take care of the day-to-day operations of a property, which can be time-consuming. They also need to be knowledgeable about the rental market and understand the ins and outs of the landlord-tenant relationship.
What Is a One-Time Setup Fee
It is a charge assessed by a property manager to cover the costs of setting up an account and getting a new tenant moved into a rental unit. This can include things like advertising the property, preparing any necessary paperwork, and conducting initial screenings of potential tenants which you can view more here to guarantee compliance. A credit check or background check on you as the property owner may also be part of this.
This one-time fee is usually a few hundred dollars and is in addition to the first month’s rent and security deposit. This is normally non-refundable.
Are There Any Monthly or Annual Fees
As a general rule, property managers do not charge monthly or annual fees aside from their management fees. However, there may be some exceptional circumstances where one does charge additional.
For example, if a property manager is also responsible for collecting rent, they may require a small processing fee for each payment they collect. Additionally, if they provide other services such as marketing or leasing, they may bill it separately. These are generally negotiable, and most property managers are willing to work with their clients to create a custom package that meets their needs and budget.
Some may also impose an annual fee, which is a flat fee charged once per year. The amount will again vary depending on the company but is typically between $100 and $200.
Is Hiring One For You
What do property managers charge? After reading this article, you must have an idea now of what the cost is going to look like before deciding to hire a property manager.
Overall, they charge a percentage of the total rent collected on a monthly basis. There may be other associated fees, such as for marketing or legal services.
For landlords who are new to the rental game or who don’t have the time or ability to manage their own properties, hiring one who’ll handle this may be the best way to go.
If this article has been helpful to you, keep reading our blog today to learn more!