I'm working up a proposal to manage about 10 units...(8 duplex units + 2 other homes)...all in my area in NW Austin. Average rent is about $1,300. My normal fee for one unit is 8%. Anyone out there have experience providing bulk discounts for a similar range of units? If so, how did you structure your agreement?
I have a friend that received a discount in exchange for agreeing to exclusive / right of first refusal for future units in his portfolio. I think it also locked him into using the PM for add on lines of business like using their repair services or something similar.
This shows that you value the owner's business, but you want them to show loyalty in exchange for holding them in place.
As a marketing guy (a short time a number of year ago), I might suggest that you make some copy print with 3 or 4 different levels of "partner" or similar deals. Regular, good, better, best. This would be around the better level with best having the owner 100% hands off with notifications and auto reports. Maybe have a minimum of doors for each level with the discount in place based on your scale of economy.
I just remembered what one of the terms of that contract were -- that the owner opted into the PM's online rent collection system where everyone paid online for free or paid something like $10 extra a month for non-online payments. I am sure that PM got a piece of that somehow, but it also allows for less people in the office and less manual processing work for your office staff.
Thank you, Joe!
I offer a small discount for newer, low-maintenance homes or for multiple properties (three or more). My typical management fee is 10% and my steepest discount is to 8%.
I'll offer a small discount (1-2%) for managing multiple properties. Much depends on the properties themselves, condition and location(s). Regardless of who owns the properties, the same amount of work/effort still has to be performed per property.