What Is In A Property Management Fee?

Submitted by: Stewart Wrighter

As a property owner, you want to make sure that the RI property management company you hire will create a stable link between themselves, you and your tenants. And of course, you will want to know that you are getting the best services for your precious dollar. A property management RI company should be able to provide landlords with either an all-in-one package deal or a plan specifically suited to individual needs. Because services vary quite a bit, fees can be very different as well. Luckily for landlords, service plans can always be rearranged to tailor to the needs of a particular property. Landlords should know a few things about common fees before getting involved with such a company, this way they will have a better understanding of what to expect and be able to tailor fees to suit their budgets.

Commission is the most unavoidable of fees. This is paid to the property management company each month, for that company s work overseeing the management responsibilities. Landlords cannot avoid paying commission, but they can shop around for a company who charges a lesser percentage. Generally, property management companies charge a commission equivalent to 3 to 15 percent of tenants monthly gross rent. Landlords may be able to find companies which charge a flat monthly commission rather than a percentage fee. A flat fee can be as low as $50 a month to more than $200 a month, but property owners should not expect to find a company which does not charge commission rates.

When a new tenant moves into an apartment unit, a lease-up or setup fee is generally charged to the landlord. This fee covers the initial time and resources that go into creating a new account. It also covers time spent showing the empty apartment to the tenant and any other costs of placing a new tenant in the apartment. The setup fee is similar to a finder s fee. Much of the time, this fee is deducted from the first month s rent paid by the new tenant. There are some companies, however, which prefer to collect this fee upfront, before the new tenant is even found. The fee is very standard and not refundable once the management company has begun work to find a new tenant for a property.

Another fee is charged to the landlord when a tenant renews their lease. When a current tenant decides to stay in the same apartment for a set number of years, this fee covers the cost of filing paperwork and any communication set forth to clarify the new lease. It may also cover the costs of performing an inspection of the property. Although there are many companies which do not bother charging this fee, some may charge upwards of $200 for their services.

Finally, landlords should be wary of mark-up charges. Often times, these may be set forth late in the game, a property owner may not see them coming until the bill arrives. A mark-up is a charge covering any repair work done on the property using in-house staff, or simply a charge over and beyond what is usually allotted for property maintenance.

About the Author: Stewart Wrighter recently met with an expert in

property management RI

to help him find office space in the area. He hired a

RI property management

company to oversee his apartment complex he purchased.

Source:

isnare.com

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