Question about Property Management in Ohio
I have a question if you guys don't mind. My buddy just invested in Akron Ohio long distance from NY. I'm considering doing the same. But he said the prop. management he looked into out there takes a percentage of profits from everything, including repairs. If that's true then what's the incentive to keep the investor's costs low? Is that the norm with prop. management out there? Are there companies that don't benefit from your normal expenses? Any input is greatly appreciated. Thanks in advance
Most Popular Reply
Hey Donnie, agreeing with Kerlous here. Good property management companies do tend to charge fees on multiple things on top of their monthly rent percentage cut. The reason for this, is the variable work, to put it simply is, A LOT OF WORK. My guess is one fee you and your friend are noticing is a percentage cut from third party maintenance work. Managing other contractors, scheduling with them and the tenants, making sure they are on time, doing a good quality job, takes a lot of time, and having a good team to manage that is crucial. Therefore, that fee is there to make sure that they are getting the job done the first time.
Anyone who is saying that they can do a great PM job and won't charge you anything besides the monthly fee, is most likely going to fail out of the business because they won't make enough to stay in business, hire and grow.
It is very important to understand all the fees associated with a PM, but I encourage you and your friend to not shy away from a company right away if you see they have fees on other things other than a monthly cut. Otherwise, you probably will end up with a cheap, bad at communicating company who you will end up regretting hiring because they aren't actually getting anything done.