Property Management Fees

[Chris Archer]

I have found most management companies take 10% rent plus one half to one full months rent amount when filling a unit.  Considering a 12 unit with $1,000/month rent per unit.  Worst case scenario all tenants could leave after 1 year and once property management re-fills all units, there would be a charge of $12,000??  Or each time a unit is filled property management takes $500-$1,000?  If this is the correct, where do all of you investors account for this charge when running your numbers?  Thank you.

[Ned Carey]

@Chris Archer welcome to BP. Yes that is typical but with a 12 unit building you may be able to find a manager for less than 10%. If all your tenants leave after one year you have a bigger problem that just the leasing fees. Something would have to be seriously wrong for all the tenants to leave at one time. 

Management and leasing fees should be considered as expenses when evaluating a property to purchase.