One of the first questions I get from a potential client is: how much does property management cost? There are a couple of ways to look at that.
Paying between eight and 10 percent of your rental income is what’s common in the industry. You have to look past that percentage though, because what’s more important is the service you get in return. The cost of property management could reduce your risk of a bad tenant. With one bad tenant, you can end up spending thousands and thousands of dollars in lost rent, legal fees and property damage. There’s also your own stress level, which skyrockets when you have to handle such a situation. Preventing one bad tenant more than pays for your property management costs.
The handling of your investment property is serious, and you need to consider the value of that service. Think about your time, and how much it costs not to have calls in the middle of the night when maintenance is needed or emergencies with neighbors have to be handled.
If your property manager reduces your vacancy time with excellent marketing and selects a high quality tenant with the best screening processes, and if they document inspections and handle everything professionally from A to Z, then the eight to 10 percent you pay is a bargain. You will earn more money by reducing vacancy, maximizing value and properly maintaining your property. These things help you earn more on your investment, so using a professional property manager doesn’t have much of a cost at all. You’ll net a better result than you would if you didn’t have a property manager. You’ll also get better protection for your investment.
Please contact us at American Heritage Properties if you have any questions about the cost of property management and what you can expect in return.