Key Takeaways
- Property management fees vary based on services offered, property location, and company structure.
- Costs can include setup, ongoing management, tenant placement, and occasional additional fees.
- Hiring a company like Keyrenter Buxmont helps reduce stress and maximize your return on investment.
Do you own a rental property in Doylestown, PA, and are considering whether to work with a property management company? If so, this guide is for you.
Hiring a property manager can help you minimize stress and maximize income. You no longer need to worry about filling vacancies, handling tenant concerns, or responding to maintenance requests when a trusted property management team like Keyrenter Buxmont is by your side.
Additionally, an experienced property manager can help you take advantage of various tax deductions and determine the ideal rental price for a strong return on investment.
That said, professional management comes at a cost. So, how much should you expect to pay?
How Much Does Property Management Cost?
Property managers charge fees based on the services they provide. Some use a flat monthly rate, while others charge a percentage of the rent collected. Either way, the most important thing is to understand the total cost before entering into a management agreement.
As a property owner, you’ll also want to know exactly what those fees cover. Reputable companies like Keyrenter Buxmont usually include a detailed breakdown of services and pricing on their websites for transparency.
Let’s explore what is commonly included in standard property management pricing.
Initial Setup Fee
This is typically the first fee charged when you begin working with a property management company. It covers administrative work, onboarding, and creating your owner account.
Most companies charge between $300 and $500 as a one-time setup fee. However, not all companies include this as a separate charge. Some may absorb it into their monthly management fee or include it in a package rate.
Ongoing Property Management Fee
This is the primary recurring fee. It covers the day-to-day responsibilities of managing your rental. Some companies charge a flat fee, such as $200 to $300 per month, while others charge a percentage, typically between 7% and 10% of the monthly rent.
For example, if your property rents for $3,000 per month, the fee might range from $210 to $300.
This fee usually includes:
- Rent Collection: The manager collects rent and deposits it into your bank account.
- Maintenance and Repairs: Includes regular inspections and coordinating repairs based on tenant requests or preventive needs.
- 24/7 Customer Service: Tenants can report issues any time, reducing your involvement in emergencies.
- Financial Management: Includes bookkeeping, expense tracking, and tax document preparation.
- Utility Coordination: Some companies handle utility transfers and billing oversight.
- Advertising and Marketing: Managers market your property during vacancies to reduce downtime.
- Tenant Screening: Includes background checks, employment verification, and references.
- Eviction Handling: If necessary, the manager will handle the eviction process according to local laws.
Costs may vary depending on your property’s location. Properties in high-value or competitive markets often come with higher management fees.
Tenant Placement Fee
Tenant placement fee is also commonly referred to as a leasing fee. This cost goes towards filling a vacancy left after a tenant moves out at the end of their lease.
The tenant placement fee covers the entire leasing process. From property preparation, to marketing, to lease drafting, and everything in between.
Generally, though, before the process can begin, a property management company will usually conduct a walk-through of the premises. The purpose of the inspection is to document the property’s condition and see whether it is rent-ready or not.
If it isn’t rent-ready, the property management company will provide recommendations on what aspects may need fixing first. For example, painting tired-looking walls, fixing a leaky faucet, or replacing burnt-out bulbs.
Property Marketing
Once you’ve handled the necessary improvements, the next step the property manager will take is to prepare a rental ad. To do this, they will take photos of the property, and write an engaging property description. They will then list the ad on multiple offline and online platforms for maximum reach.
Examples of such platforms include using social media to market your rentals, rental listing sites, yard signs, and local community bulletin boards.
Tenant Selection
After the marketing process is over, some rental applications will begin coming in. It’ll be your property manager’s responsibility to screen them.
They will need to screen the tenants meticulously, all while ensuring the process is fair to all applications. The best thing is that property managers understand the Fair Housing Act and all its provisions.
Lease Signing
After the screening process is over, the next step would be to sign a lease with the tenant. A property manager will help draft a lease agreement’s terms and get it signed by the right tenant.
The property manager will also help handle the move-in inspection. This is a process where they will have to walk through the property with the tenant to document its condition. This is a necessary step to ensure the tenant knows what condition they must leave the property in when they vacate.
Miscellaneous Fees
In addition to standard management and placement fees, there may be other charges depending on the services provided.
- Lease Renewal Fee: This fee is charged when a tenant renews their lease for another term. It typically ranges from $150 to $300 and covers lease updates and tenant communication.
- Maintenance Oversight Fee: Some companies add a small percentage to maintenance invoices to cover the coordination of repairs. Others include this in their base management fee or charge only when major work is required.
- Annual Inspection Fee: Routine inspections help maintain property condition and enforce lease terms. These inspections usually cost between $100 and $200.
- Eviction Fee: While evictions are less common with good tenant screening, they can happen. If legal action is required, a property management company may charge up to $1,200 per eviction, especially if court involvement is necessary.
What Should You Expect to Pay Overall?
So, what is the total annual cost of hiring a property management company?
While the answer varies based on the company, services, and your property’s size and value, most landlords can expect to pay around $2,000 per year per property on average.
Although this represents a significant investment, the savings in time, reduced vacancy rates, and avoidance of legal issues often make the cost worthwhile.
Bottom Line
Keyrenter Buxmont is a trusted property management company based in Doylestown, PA. We offer transparent pricing, responsive service, and personalized support to help you achieve long-term success as a landlord.
Whether you are managing a single rental or building a larger portfolio, our experienced team is here to take the stress out of property management.
Contact us today to learn more about our services, pricing structure, and satisfaction guarantees.
Disclaimer: This article is intended for general informational purposes only and does not constitute legal, financial, or professional advice. Property management fees and practices may vary by company and location. Always consult a licensed property management professional before making decisions regarding your rental property.