Key Takeaways
- Property management fees cover multiple services — including rent collection, tenant communication, maintenance coordination, marketing, tenant screening, and more, typically costing between 7–10% of monthly rent.
- Additional fees apply for specific services — such as leasing fees for finding new tenants, lease renewal fees, inspection fees, and maintenance coordination charges.
- Transparency is essential — reputable property managers clearly outline all services and associated fees, avoiding hidden costs.
- Costs vary by property and company — there’s no universal price; owners should request a personalized quote from a local, experienced property manager like TXC Realty.
A property manager can save you time, money, and even the frustration that comes with owning a rental property. They will handle everything from rent collection, property marketing, tenant screening, and everything in between.
But just like every good thing under the sun, there is a cost to it! If you choose to work with a property manager, there are certain fees you’ll need to pay. Fortunately for you, though, that will be nominal compared to the enormous savings you’ll make.
You see, successful landlording all boils down to one thing: how good you are able to manage the property.
And that’s why savvy rental property owners choose experienced property managers. Their experience, coupled with a client-focused approach and cutting-edge technology, can only result in optimal ROI.
With that in mind, here’s what to know when it comes to property management costs.
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What Fees Go Into Determining a Property Management Cost?
Initial Account Setup Fee
More often than not, this is going to be the very first fee your property manager will charge you. It’s a one-time fee meant to open an account with the company.
The fee goes towards covering the paperwork and processes necessary to set up an account with the property manager the company has assigned to you.
Property Management Fee
This fee encompasses a majority of the services the property management company offers rental property owners. As such, expect this to form the bulk of the property management cost.
The cost is about 7 and 10% of all the monthly rental income. If, for example, you’re collecting a monthly rent amount of $2,000. You can then expect to pay your property manager a property management fee of between $140 and $200.
Below is a list of services you can expect to get from the property manager in turn.
- You can expect the property manager to collect rent every month after it becomes due per the terms of the rental agreement.
- After they have collected all due rent, the property manager will then deposit the amount, less any expenses, to your preferred bank account.
- The property manager will handle all the back-and-forth communication with tenants.
- You can count on the property manager to handle all needed or requested repairs and maintenance, necessary to keep your property in tiptop shape.
- These are key to ensuring your property remains in good condition at all times. Your property manager can help do them on your behalf, saving you time and effort.
- After the property becomes vacant, the property manager will run a marketing campaign and select a high-quality tenant for placement on the property.
You can check these services on the company’s service page. If a company doesn’t have it, please continue looking. The lack of transparency is a red flag.
Leasing Fee
This is another common fee that a typical property management company will charge a rental property owner. The fee goes towards covering the process of re-renting a vacant unit.
And that includes preparing the unit for renting. The property manager will inspect the unit to ensure it’s in rent-ready condition. If it is, the property manager will begin the marketing process.
But if not, they will advise you on what to do to bring it to that condition. Last but not least, the property manager will sign a lease with the tenant.
Rental Marketing
As already mentioned, this is part of the leasing process. However, rental advertising is usually multi-faceted with many moving parts.
The following are some of the things that go into marketing a rental property and which your property manager will help handle.
- Prepare a rental ad that is attractive and detailed.
- List the rental ad to websites like Zillow, Trulia, and Craigslist for maximum reach to prospective tenants.
After a successful marketing process, tenants will begin reaching out for further inquiries.
Tenant Selection
When applications start streaming in, your property manager will begin the tenant screening process. The goal would be to ensure that you only rent to quality tenants that possess the following qualities.
- Pay rent on time, every month.
- Care for their rented premises by using it for the intended purposes and reporting issues on time.
- Abiding by all terms of the lease agreement.
To land such a tenant, the property manager will screen prospective tenants based on their creditworthiness, income level, rental background, and criminal status, among other things.
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