How much should you pay a property management company
Hey all,
Just have a question in regards to property management. I'm currently looking to invest in university housing, so I understand that these property management companies can charge a premium. That being said, I feel like the property management companies I've found thus far are charging too much. From what I've read, a owner expects to pay 8-12% of rent to a property management company. The companies we have seen so far charge 15%. We also are charged a tenant acquisition fee of $400/tenant or half of firsts month's rent, which is significant because there is a high probability we will have new tenants each year, and we're looking at properties with 8-14 bedrooms. As far as repairs, they hire their people to do the repairs and we pay them an hourly rate, ranging from $35-$115/hour. If they need to outsource, we pay for the services plus a 10% fee to the property management company. They can do any repair less then $500 without needing to notify us.
I am new to real estate investing, so this might be considered normal pricing in a niche market such as university housing, but would love to hear back from the community for confirmation of whether or not these prices are to be expected. Also am curious to see if people have been able to do more a hybrid experience, where the owner can do the marketing and find the tenants, while the property manager just manages the property. And if there are any repairs, he finds the contractors who we pay, but without giving him a percentage. Any advice will be great. Thanks!