As you likely know, a management fee is a fee that Property Management companies charge for managing your home.
At T&H Realty, our management fee is generally 10% of the rents collected. Meaning, if your home rents for $1,000 per month, our management fee would be $100 per month. If no rent is collected, then there is no management fee. Again, we do not charge any vacancy fees. We only charge you a management fee when we collect rent for you.
Like leasing fees, property management companies in Central Indiana charge different type of management fees. Some use a percentage of rent collected like we do, while some charge a flat rate per property.
A common question we receive is, “What does my management fee cover?”
There are a variety of things a management company does to earn the management fee, including:
What Does a Management Fee Cover?
1) Collecting rent and disbursing those net proceeds, monthly, into your designated bank account.
2) Providing monthly statements that show your income and expenses. In addition, your management company should provide a year-end statement along with a 1099 for tax purposes.
3) Handling the day-to-day activities that may accompany your property, including an HOA complaints, roommate disputes, etc. There’s a whole list of items involved in the day-to-day management of a property.
4) And there are other value added benefits that a management company may provide to earn its management fee. For example, we conduct detailed move-in and move-out videos for all of our properties. While this does take additional time, the videos prove to be very valuable when security deposit disputes arise.
Peace of Mind
The biggest way a management company earns its fee, in my opinion, is by making itself available 24/7 to handle any issue that may arise with the home. It creates peace of mind knowing that your property is being managed by a professional organization, who should be able to handle any issue at any time.
Providing a service like this is expensive. A well-run property management company has an enormous amount of overhead, including multiple insurance policies, licensing, company vehicles, technology, staffing, and office space.
If you have any questions about our management fee, please don’t hesitate to contact us.