What is a Good Bargain for Morrisville Property Management Fees?
Every value shopper loves a great bargain. As a property manager for single family homes and townhomes in Apex, Raleigh, Morrisville and Cary, we often take phone calls from prospective Landlords who are trying to determine the cost of hiring a competent property manager. Is hiring a licensed property manager a good bargain?
Reasonable Morrisville Property Management Costs
The answer is that it “just depends.” Reputable property managers in the Triangle area generally charge a fee of 8-10% of the monthly rental income. This monthly expense seems reasonable to Morrisville Landlords who understand the value of their time and mental health.
There are also other property management charges to consider. One example is the charge to recover the cost of advertising your Morrisville or Cary rental property. This is sometimes called the acquisition fee. If the Landlord was going to act as their own property manager, their cost of advertising is essentially the same as a reasonable acquisition fee charged by a property manager. Therefore, this is sort of a neutral point. The actual cost for advertising your Morrisville rental property does not change much if a Morrisville Property Manager does the advertising instead of you as the Morrisville homeowner handling the advertising alone.
Cost of Do-It-Yourself Morrisville Property Management
A quick thought about this last point. A Landlord who wants to act as a do-it-yourself property manager for his/her Morrisville rental property should be prepared to receive 20-30 initial inquires. The next steps in the acquisition process are showings, second showings and ensuing negotiations. One could easily suggest that hiring a Morrisville property management professional is less expensive and certainly a lot less stressful. However, let’s keep the assumption that the advertising costs (i.e. acquisition fee) does not add or subtract from the question of, “Is working with a professional Triangle Property Manager a good bargain?”
Hidden Property Management Fees
If you have a monthly rental income of $1,000 per month, a twelve month lease produces $12,000 in gross annual income. Now let’s assume that the Tenant had a twelve month lease and decides not to renew for another twelve month term. You are now left with a vacant rental property that produces no income. In addition, there are holding costs, like your mortgage payment, yard maintenance and utilities. There may also be some expense for minor repairs to get the property ready for the next Tenant.
A 60 day vacancy could easily cost $3,000 when you factor the loss of rental income for two months and the additional cost of holding and repairing the property. A $3,000 price tag for Tenant turnover is easily 100% more than the annual cost of professional property management. Now we have found the real value or bargain of an effective Morrisville property manager.
Real Property Management Value
A Morrisville area property manager that is a real bargain is one where the manager has a system in place to keep good Tenants in properties (i.e. see our Three Star Resident Reward Program) and one that, when necessary, knows how to get your property rented again in 48 hours.
If you have a question about Property Management in Morrisville or anywhere else in the Triangle area, just send Fred an email.
