Are these management fees reasonable? (Indianapolis)

[Chris Collins]

Looking at property management in Indianapolis, management company is directly associated with a turnkey company.

Avg purchase price $120k

Avg rent: $1,200/mo

Fees are as follows:

Property management fee 8% of income collected.

Leasing fee is 80% of first month’s rent. Your first tenant comes in the property at closing (there is no fee).

$400 lease renewal fee

My worry is the 80% of first month's rent for a new tenant.  If a new tenant comes in every 18 months, that eats away on a few months of cash flow...

Is they typical?

Thanks!

x CHRIS x

[Fred Heller]

Everything's negotiable but a "typical" leasing fee for a new tenant is the first month's rent. Half of that goes to the cooperating agent who brings the tenant to the table. So 80% is on the low side. $400 to renew an existing tenant seems pretty high to me. I've seen some companies charge $200 for that. Personally, I don't charge any fee to renew an existing tenant.