Investment property can be very lucrative. It makes sense to protect your rental investment and ensure the best experience for your tenants responsible for generating revenue.
Most property investors are purely interested in the investment only and not the responsibilities associated with being a landlord, thus they hire a property management company to assume the task of managing the property. In hiring a property management team, you will benefit from personalized, on-site services for your tenant, rent collection and account management, maintenance services to ensure your property is well maintained, and the management of vacancies sure to occur with your property. A vacant property is not making you money, it’s costing you money.
So when hiring a property management company, how much should you expect to pay?
Property management fees will typically cost an investor 5% – 10% of the amount of rent revenue collected on the property. Before you think twice, consider the time, money, and management tasks you will embark on without the partnership a management company will afford you. You will immediately become an employer as most property management efforts without a management team will require you to hire a residential manager. This will require a full-time salary along with benefits in most cases. You will also have to manage vendors associated with the maintenance tasks of your property. Finally, you will have to deal with the overall satisfaction of your tenants needs and the keeping the property occupied. This requires you to understand marketing, real estate market conditions, analysis of your local market to ensure you are charging the appropriate amount for rent, so on and so forth.
Needless to say, the investment in a property management company is well worth the 5% to 10% of your rent collected. If you can afford the cost of this partnership, it’s definitely worth having to maximize the potential profits your investment is sure to generate.