Question on Property Managers

[Laurence Walsh-Hodson]

My current property manager wants to charge one month's rent (plus 10% of all rents) to manage a property newly vacated. This is a duplex and they already have a contract to manage the duplex, but they are saying they need a contract "for each door". They say it is for marketing, but that is a huge budget for marketing. Any helpful thoughts or suggestions?

[Michael Smythe]

@Laurence Walsh-Hodson not sure of the laws in Indiana, but here in Michigan, we do NOT need a contract for each door. Maybe their MLS is requiring it?

Regarding the one month of rent Placement Fee, this is fairly normal. There are "hot" markets where PMCs can just put a rental on their website and get acceptable activity. These PMCs may only charge 50% of one-month of rent for Placement.

Most markets are slowing down though and putting a rental on the MLS will get more activity. Putting it on the MLS though, requires offering compensation to an agent that brings an acceptable tenant.

Of course, this is all changing due to NAR's settlement, effective August 13, that no longer allows listing agents to offer buyer agents compensation via the seller.