When renting out a property, many landlords turn to property management companies to streamline operations and maximize profitability. However, every property management firm can be different when it comes to what is and is not included in the property management fee.
While it’s important to check with your property management company on this, here, we discuss the typical things that are included and excluded in this fee to give you a better understanding of what to expect when hiring a property manager.
Understanding Property Management Fees
Property management companies charge a fee for their services, which can vary significantly based on several factors, including location, property type, and the range of services offered. Property management fees are typically based on a percentage of the monthly rental income, usually ranging from 8% to 12%.
Common Inclusions in Property Management Fees
Generally, the property management fee covers a core set of services. Here’s what you can typically expect to be included:
Annual inspection. Property managers typically conduct thorough yearly assessments of the property's condition, documenting any wear and tear, maintenance needs, or potential issues. This proactive approach helps identify necessary repairs early and maintains the property's value over time.
Lease management. Property managers handle lease agreements and renewals. They ensure the lease complies with local laws and is in the landlord’s best interest. If any issues arise, such as violations or early termination, the property manager will handle them.
Rent collection. Property managers take responsibility for collecting rent on behalf of the landlord. They often use automated systems that make payments easier for tenants and provide the landlord with timely financial reports.
Maintenance and repairs. Though this can vary, property management fees typically include coordination of routine maintenance and emergency repairs. Managers often have a network of reliable service providers to address any issues that arise quickly.
Financial reporting. Property managers provide regular financial statements detailing income, expenses, and other relevant metrics. This transparency keeps landlords informed and helps them assess the property’s financial performance.
Compliance and regulations. Property managers are well-versed in local real estate laws, ensuring that the property adheres to regulations concerning tenant rights, safety codes, and property upkeep.
What Is Not Included in Property Management Fees
While property management companies provide many services, several responsibilities may fall outside the standard fee structure. Below are some common exclusions:
Tenant acquisition. Some property managers will find tenants for an additional fee. The fee can include marketing the property, conducting showings, and screening potential renters with thorough background and credit checks.
Major repairs. Although ongoing maintenance may be included, larger repairs (such as roof replacements or major renovations) typically require an additional fee.
Legal fees. Should a tenant need to be evicted or there are legal disputes, these issues often require separate legal consultations and fees that are not covered by standard management fees.
Advertising costs. While initial marketing for tenant acquisition may be included, some companies charge extra for ongoing advertising efforts, especially during periods of high vacancy.
Utilities and services. Costs for services such as landscaping, cleaning, or utilities (if applicable) are generally not covered by the management fee and must be managed separately.
Administrative fees. Some property management companies charge for additional administrative tasks outside their usual scope, such as facilitating complex tenant requests or providing extra financial reports.
Hire the Right Property Manager in Northern Virginia
Are you ready to hire a property management company in Northern Virginia? Contact Circle Property Management today at (703) 349-0144. Our top-rated property management firm provides competitive fees for landlords that include a wide range of services so you get the most value for your money. Get a quote today!
About The Author
Patrick H. Page - Principal Broker | Licensed in Virginia and the District of Columbia
