What are typical property management fees?

Property managers play a crucial role in ensuring a smooth running of operations on the contracted property. Deciding to work with one is a big step towards realizing the benefits of a professionally managed premise. However, you need to understand that these services neither come free nor cheap. What are typical property management fees? Let us look at what a property management company would charge.

Monthly Management Fee
This fee is charged for services linked to ensuring timely rent payments, maintenance management, collection and acceptance of rent payments, property appraisals and emergency maintenance. The fee is computed as a percentage of the total rent collected on the property.

Leasing Fee
This fee is associated with advertising the property, screening tenants, reviewing applications, processing the paperwork and preparing the premise for tenants moving in. Also known as placement fees, it usually costs at least three-quarters of the initial month’s rent.

Vacancy Fee
Some property management companies will still charge this fee despite the fact that the property is unoccupied. This is usually small flat fee or standard monthly management fee.

On-boarding Fee
It is also referred to as setup fee. It may be charged as a one-off amount establishing a partnership with the company managing your property, to set up your account. These prices vary depending on the number of properties or units in your portfolio.

Maintenance Fee
Depending on the person(s) the property managers subcontract to perform maintenance activities around the property, they may charge a markup fee which they keep the difference from the owner as their income.

Eviction Fee
An eviction fee is charged to tenants who have been evicted. This is to cover the trouble the property managers went through and time spent in processing the eviction; going to court and paying legal fees.

Late Fee
Property managers require tenants to pay an additional fee if they make rent payments after the deadline. The manager may take part of it or pass it whole to the owner.

Lease Renewal Fee
Whenever the renter decides that they are renewing the property lease, the property managers will normally impose a standard fee for theor a whole month’s rent. They treat the lease renewal as a leasing fee.

Other Income Fees
Property managers may also choose to keep a fraction of all income accruing from rental income for pets, bounced cheques fees, lease violation fees, bill payment fees, income from laundry and vending machines as their own. Alternatively, they may choose to pass all these revenues to the owner.

When you decide to contract a property management service provider, it is imperative that you make as many inquiries as possible regarding their fee structure and subsequent services offered. Look at their overall performance and based on this, decide if its worth the price before looking for an alternative. Remember to also bargain for more affordable fees and better terms of service. Whichever decision you make, you will realize that at the end of the day, a property manager is inevitable especially if you have multiple properties. They do all the dirty work and spare you the trouble.

Click here for more information on our management services.