The first question asked when I am talking to a potential client is “how much do you charge?”. This is an understandable question in these cost conscious times we live in.
Pinellas County, FL. property management is fairly standardized in the field of what we charge. Typically, it is 10% of the rental income as the management fee. This usually handles the work done to coordinate maintenance, unit turnovers, tenant communication, etc.…
There is also the “dreaded” leasing fee. I say dreaded because this is one of the most misunderstood fees in the business. It is the fee that a property manager will charge when a new tenant signs a lease or when an existing tenant resigns a lease. This fee is very important and I could spend a lot of time talking about it, but I will save that for another blog. Stay posted.
However, the question that potential clients should be asking me is not how much we charge for property management but how much does property management COST?
What is the difference?
It is rather simple:
We charge a certain fee for the services we provide. We are professionals who know a very specialized field. But, at what cost is it to you to hire us?
The cost of professional property management is the difference between how much you pay a property manager to do the job efficiently and how much time and money it would take you if you tried to do it yourself.
What can a property manager do for you?
A property manager in Pinellas County should have an arsenal of vendors at their beck and call that usually will give them a better deal because they give them so much work in return. It’s a classic example of “You scratch my back, I’ll scratch yours”. Unfortunately, there are vendors out there who see the inexperience of someone trying to go at it alone and they may take advantage of the situation by hiking up their prices, or doing the job poorly in the hopes of a call back.
A professional property manager should advertise aggressively to fill a vacancy. They should be available to show at a moments notice and be doing market rent surveys to make sure that the rent that is being asked is fair market value for that property. As an owner going at it alone, you may not be so willing to leave your house on a rainy day at 4:30pm to go do a showing, thus taking longer to fill a vacancy. A vacancy sitting too long is money right out the door.
Lets take a $1500 condo that needs management. The typical management fee a property manager in Pinellas county fl will charge for this is $150 per month. I know many owners will cringe at this as they think they can just pocket this money and do the management themselves.
Let me ask a few questions:
- Do you really want the 3am call on a Saturday morning that the hot water heater has burst?
- Do you want to legally draw up the late rent payment notice if a tenant pays rent after the 5th and personally serve it?
- If the fridge dies do you want to spend Thanksgiving day going from store to store to find the best deal?
- Do you want to spend your time advertising a vacancy on all of the known avenues a professional property manager would use? Do you even know all of the known avenues?
- Do you want to spend a Saturday away from your family doing showings to fill a vacancy?
- Do you want the endless calls of “how much is the rent”? “What are the requirements?”, “What is the deposit?”
- Do you want to pay a rental verification site to run an applicants information? (I hope you wouldn’t even think of NOT running a prospects credit…. again, that is enough trouble to fill up another blog post!)
I could fill 3 pages with similar questions.
The point is that you may want to ask yourself if this worth $150 a month to make this all go away?
I should be asking you what is your time worth to you? Isn’t $150 worth it to have time to do other things and to know that your property is being taken care of by a professional?
If you think hiring a professional is expensive, you should try hiring an amateur.
Jennifer Fehr is the co-owner of Suncoast4Rent with her husband Tom Fehr. Jennifer is a Florida State Real Estate Sales person and works through Stonebridge Real Estate Co Inc in Clearwater, Fl (Pinellas County) to bring the personal touch to all your Real Estate needs, be it professional residential property management, consultation or sales.
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