One of the basic questions we always get is: how much does it cost to employ you as a property manager? I think the better question to ask is: how much value are you going to get from the services we provide? A good property manager should be able to provide a return on your investment. In the end, most good property managers will save you more money than it costs to use their services.
Here’s an example. We recently got a phone call from an owner we had worked with about eight years ago. She had used us to help her find a tenant for her property, then we turned the management over to her and she handled everything herself ever since we placed the tenant. She called, and as we were talking, we asked how much the rent is on her property now, compared to eight years ago. She told us she had not raised the rent at all in eight years. Now, over those eight years, we probably would have raised the rent between 12 and 14 percent. So, if she had kept us on to manage her property, we would have made her more money than it would have cost her to have us do it.
The cost of a property manager also has to be measured against the amount of time it takes to do the work. As an owner, you might spend a lot of time on your property, whether it’s answering phone calls, finding a tenant, coordinating maintenance, handling bills or chasing down late rent. You must consider how much your time is worth compared to what you pay a property manager on a monthly basis.
In the end, you need to look at your long term investment and how much return you should be able to get from your property manager. In this area, the average cost is between six and 10 percent of monthly rent, depending on the property management company and the services that are provided. There might be additional charges on top of that fee. Think about what kind of value you are getting and what kind of returns you can project on that investment. A good property manager should be able to answer those questions for you.
If you have any questions about hiring a property manager, or what you should expect to get in return for your fee, please contact us at Aapex Property Management, and we’d be happy to talk about it.