What are typical property management fees?

[Justin Dao]

Hey BP community,

Apologies if this question has been asked before, but what should I be expecting to pay for typical property management fees? I am currently in the process of vetting different PMs, and I’ve found there to be quite a range of prices for all-inclusive service.

I’ve come across a few PMs that charge a full month’s rent for placement of the tenant, and 10% thereafter. Is this uncommon?

What would you pay all-in, for quality property management?

[Kenny Dahill]

@Justin Dao, this varies on market and asset.  However, you can expect a 14-18% of gross income which will include your monthly management fees and leasing bonuses. 

The real concern should be the hidden fees.  Make sure you understand ANY and EVERY way your PM will earn a fee, and have them point it out in their management agreement.  It should be very black-and-white.

How much do they charge for coordinating maintenance?

What is their minimum trip charge for their handyman?

What is their handyman hourly rate?

Will you get a copy of the vendors invoice or do they simply put it on their own form?

What is their tenant placement guarantee?

Are evictions or late notices extra cost?

Who keeps the late fees?

Unfortunately 'monthly management fee' is the neon marketing sign to get you in the door, then they commonly charge you excessive fees in other ways.