If you own rental real estate, then you are likely already familiar with the fact that there can be a long list of expenses with this endeavor. These costs come not just in the form of dollars and cents, but also in the amount of time that it takes to manage your property(ies) and tenants.
As an investment property owner, you may have considered working with a property manager, but have shied away from doing so because of the potential costs. The reality is, though, that even with having to pay a property management fee, it can be well worth it if you’re able to concentrate on doing other things.
The “Price” of Property Management
As with many other business arrangements, what a property manager charges can depend on a myriad of factors, such as the type, size, and location of the property, as well as the scope of services that they’ll provide. It can also be dependent on the anticipated number of hours the property management company will need to devote to the particular property.
For example, in some cases, residential property management firms may charge a certain percentage of the monthly rent that is coming in. In other instances, property managers may charge just a flat dollar amount per month.
Additional items that may be factored into the management fee may include the following:
- Finding, screening, and placing new tenants (including marketing and advertising costs)
- Property maintenance
- Collecting rent from tenants
- Collection of late payments
- Handling evictions
While the expense associated with property management can reduce the amount of net income that you receive from your investments, the time that it can save you can be more than well worth it.
Would you like to get a better idea of property management costs on your rental units? Give us a call today.