Do all decent property managers charge a "lease up" fee. Most I have talked to seem to charge 1/2months rent on renewals, and 1 month on new lease ups.
Is that the best you are getting? Obviously the renewal and lease up fees, jack the annual percentage rate up pretty good.
Wow, I didn't know they charged additional for renewals. The new lease up rate sounds right.
My company charges 50% for the original placement and anywhere from $150-$250 on renewals.
Half a month seems high for a renewal, especially if it's a higher priced rental. I negotiated mine down to $75 for renewal. This is on a multi-unit though, don't know if they'd have gone for that on a SFR. I think some sort of fee is reasonable since there are inspection and paperwork hours involved.
People usually factor property management costs at 8%-10% when analyzing a deal, but I think it often ends up more like 12-15% in real life.
I can't see any possible justification for a half month renewal fee. For mine that would be $500 for, what, a hours work to sign a new lease? Good work if you can get it. Further, I just do month to month so there is no "renewal" anyway.
Half a month for lease up seems more common around here, but I've not actauly investigated in the last year or two.
The manager I use charges half the first month for new tenants and nothing for renewals.
I think it depends on the company.
In my area of North Carolina, I have spoken with two PM firms. One charges approximately 1 month's rent for ANY lease--new or renewal.
The other company charges a one-time placement fee (now about $400) when you FIRST place a property with them and nothing based on the signed lease.
I happen to first sign with the 2nd one just based on referrals. I only spoke with the 1st one because I had some small issues mostly around reporting. However, those problems weren't nearly enough to pay even half a month's rent on subsequent renewals. I just say that to point out that both companies are reputable, professional PM companies.
That said, I think everything is negotiable. All the work is in the original lease, so renewals should only deserve a nominal fee if any. I would see if I could argue a better rate and if I couldn't, I'd try to determine if it's worth it.
Get the Ultimate Beginner's Guide
Sign up today to receive the popular eBook for free!