Property Management Percentage

[Jesse Chunn]

This has probably been asked many times before, but I was not able to find it, so...

When analyzing a larger multi-family (50+ units), what percentage should be plugged in for a third party property management firm, assuming that you don't intend to manage any part of it yourself (other than managing the deal)?

Also, does the number change depending on class A, B, or C?

[Omar Ruiz]

Larger properties of 50 to 80 units will have a management range of 5-8%. Once you exceed 100+ units that range is from 4-5%.  10% is a reasonable range for single family homes and smaller plexes, but excessive for anything of 50 units or more. 

On my 77 unit I'm paying 5% for property managers with a CPM designation.

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