Here are the rest of the property management fees that you need to be aware of and look out for:
There are plenty of ways to generate leads using free resources like signs, craigslist, etc. but with vacancies time is money and prolonging the search process to save a few advertising dollars is a bad idea. This fee could be charged in addition to the leasing fee so it’s important to ask who pays and what the typical fees are. The better they are at marketing the less you will pay, if they have a good strategy and use tools like rentmarketer.com this should be around $100 and certainly not more than $200.
Some property managers charge this fee whenever they have to draw up the paperwork to renew a tenant’s lease. The fee typically ranges from 0-200$. The process doesn’t require a lot of work, so a big fee should be a red flag. You should ask if they require lease renewals or if they allow tenants to go month to month after the initial term is up.
These funds are used to pay day-to-day operating expenses, making sure that services are performed promptly and bills are paid in a timely manner. A reserve of $200-$500 is normal for single family properties.
Will they contact you with an estimate before performing repairs over a pre-defined amount? Is this negotiable?
Do they have their own maintenance/repair crew?
For larger remodeling/upgrade projects, do they act as the general contractor overseeing the work that is done? Is there a fee for this?
Fee for serving notices, dealing with attorneys, court appearances, evictions, etc. Hourly rates are typically $25-$50 while a flat fee for the whole eviction process usually comes in between $500-$600 (plus court costs). Find out if they typically use an attorney for evictions and what their billing rate is.
This is a small service charge (typically 1.5%) that is added each month to all unpaid invoices that are past due.
Fee for making owner payments such as mortgage, insurance, homeowner’s association dues, etc. Some management firms don’t charge a separate fee, while others don’t even provide this service.
Some management firms require an exclusive arrangement to broker your properties. If this is their policy, find out the brokerage rate and make sure there is a limited term, which will allow you to re-list with another firm if the property does not sell within a reasonable period of time. Also, if the firm requires it, how much would the sales commission be in the event that a tenant ends up wanting to purchase the property they are occupying? This is typically 1-3% but we have seen higher, always make sure to check the contract.
Find out if they will be keeping any portion of the following sources of income:
Some contracts contain a list of extra services not included in the contract along with the billing rate in the event the owner requests any of them be performed. Check to see if this clause exists, what services are listed, and what the billing rate is.
Want to learn more? Contact Bullfrog now by simply clicking this link, and one of Bullfrogs property management specialists will contact you to discuss a tailor made management program that meets your needs, or call us at 607-224-2024.