Fees to Expect When Hiring a Property Management Company
Property management is simply the operation, control as well as oversight of the real estates. Management is taking care, monitoring and being accountable of something to ensure useful condition and life. It involves all the required processes, systems as well as manpower needed so as to manage the life cycle of the acquired property. The services provided by a property management company range greatly. Therefore, the cost is not fixed. There are various costs involved which include the following.
This is a monthly fee which is charged to the owner in order to compensate the manager for the responsibilities of ensuring proper management of the property. However, this fee may vary depending on the company. It may range between 3% and 15%. Some managers may opt to decide a flat monthly charge which may range between $50 and $200 every month. All companies that offer management services charge this fee.
Setup or lease-up fee
The owner is charged this cost so as to compensate the managers for the time they have spent when setting up the owner’s account and other activities. This fee is usually deducted by the manger once the owner has received the first income. This fee is normally non-refundable once the manager has begun the process of procurement or any other legwork initiated with the property. It may vary depending on the company and is a one-time fee per every tenant.
Lease renewal fee
This amount is charged to the owner if the manager renews the current tenants lease. It covers the costs of starting the paperwork or communication used when implementing the new lease document. The manager may also justify it if they do the end of year property inspection. This cost may vary from zero to $200 and is normally charged each time a lease renewal has been implemented.
This depends on the company’s contract. If the manager is the one to cover this cost, then they will charge the setup or lease-up fee. You must also make sure that you know what type of marketing or advertising is included.
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There are many tenant resources or good rental online websites which bring in qualified tenants at a reasonable fee. You also need to consider the print media, listings on the MLS and yard signs used. Always ensure that your property is occupied and brings in money.
Maintenance mark-up charges
Mark up is a charge beyond the final bill on the maintenance and repair work done to your property by the manager using their vendors. This fee should be disclosed to you to be aware of it. Other fees that you should expect when hiring a property management company include the following.
- Inspection fees
- Virtual fees
- Admin fees
- Suggestions for improvements of your property
- Maintenance fees
- Finding tenants
- Sale of the property fee and many other fees.
In conclusion, above are some of the fees that you should expect anytime you are hiring a property management company. However, for good caring and monitoring of your property, you need to hire them.