Our topic today is the cost of property management. At Independence Realty, we offer rates with two levels of service. The difference in what you’ll pay for property management services is primarily in whether you’ll hire an agent to show your property and help potential tenants apply or if you’ll follow a tenant self show procedure, in which you don’t have anyone there to answer the tenant’s questions.
Tenant Self Show
In Huntsville, the local time on market averages at around 60 days. At Independence Realty, we have a 27 day market average, and we attribute our shorter vacancies to agent showings. When you hire a local property manager, make sure you get someone who at least provides the option of doing agent showings. If you prefer to allow tenant self shows, prepare for longer days on the market. We do tenant self shows for a flat rate of eight percent of a month’s rent. You can find other property managers in this area who are charging up to 10 percent. With a tenant self show, people come to the office and get a key to the property they want to see from the receptionist. Sometimes, there’s a lockbox on the door and a PIN code to allow them to access the key. You always hope that you get the key back and the property is left unmolested.
Agent showings give you the best results. Like most of our competitors, we charge a lease up fee, and it is 40% of a full month’s rent. This is a one-time fee and we only charge it when the unit is vacant. Nothing additional is charged for renewals. Some property managers charge for everything; loading your property into their software system can cost you up to $250, and they’ll also charge for rekeying a property, letting a tenant back in or even to sign a new lease renewal. The worst property managers will keep the late fees they charge. We discovered this recently because we have taken over some accounts and we had one property that was a real challenge. We simply could not get the rent paid on time. The owner had to get an attorney to retrieve the accounting for the last year and we learned the tenant had not been in the habit of paying on time. The property manager had been keeping all the late fees and making extra money off a bad tenant.
The best tenants pay on time, keep the property neat and tidy and they call you when they have a maintenance problem so you can take care of it right away and prevent a larger repair bill in the future. We are apt to look for and approve tenants who pay on time. We give you any late fees so there is no perverse incentive to get more money for doing poor quality work.
If you have any questions about the cost of property management, please contact us at Independence Realty and we’d be happy to help you.