Investor · The worst town to live in, KS · Member since 2016 · 4k+ posts · 4k+ votes
7y
I think it's more like 25-30 percent. I have 23 STRs with 83 beds. The only fee I have to pay is the monthly loan payment for my maintenance guys riding mower. $65/month, and he does all my mowing. I used to have a housecleaner that did it for free and I could sleep with her. Now she takes whatever she wants from the rent and leaves me with what's left. But I still get to sleep with her.
Rental Property Investor · Member since 2018 · 66 posts · 71 votes
7y
@Jingru Sui For LTR I see 8-12% alot and for STR it can range up to 15-25% depending on how much work load the management company has to take on.
If possible, it may be better to try to automate your business the best that you can and just hire a cleaner that you trust who will also help be your eyes/ears. Then have a couple handyman you can rely on to fix any issues that arise. You will still maybe have 1 hour a week that you deal with things depending on the property but if it's all running smoothly then it's better than handing over such a large % to a management company.
Also, depends on how many units you have, etc. If it's worth it to be hands off though bc your cash flow is still there then it's worth it.
Investor · The worst town to live in, KS · Member since 2016 · 4k+ posts · 4k+ votes
7y
I think it's more like 25-30 percent. I have 23 STRs with 83 beds. The only fee I have to pay is the monthly loan payment for my maintenance guys riding mower. $65/month, and he does all my mowing. I used to have a housecleaner that did it for free and I could sleep with her. Now she takes whatever she wants from the rent and leaves me with what's left. But I still get to sleep with her.
Real Estate Agent · Atlanta, GA · Member since 2014 · 683 posts · 317 votes
7y
Hey John, thank you for your response! it's very helpful! I'm actually going to found a management company that manage short term rentals. My partners have about 40 units and we have a cleaner and handyman on call. We are trying to identify each partner's responsibilities the same time control our liability. The goal is to set streamline process to help expand our business. I want to know what other property management companies are charging for short term rental because the price we set (internally) should be a market rate to be sustainable.
Thanks again!
Originally posted by @Account Closed:
@Jingru Sui For LTR I see 8-12% alot and for STR it can range up to 15-25% depending on how much work load the management company has to take on.
If possible, it may be better to try to automate your business the best that you can and just hire a cleaner that you trust who will also help be your eyes/ears. Then have a couple handyman you can rely on to fix any issues that arise. You will still maybe have 1 hour a week that you deal with things depending on the property but if it's all running smoothly then it's better than handing over such a large % to a management company.
Also, depends on how many units you have, etc. If it's worth it to be hands off though bc your cash flow is still there then it's worth it.
Real Estate Agent · Fort Walton Beach, FL · Member since 2018 · 219 posts · 275 votes
7y
I manage (and own some of my own) vacation rentals in Fort Walton Beach, FL. This is a beachfront tourist-driven area, the short-term rental industry is very well developed. The range I've hear is anywhere from 10% to 35%. I charge 15 % of gross. I provide all the full-service management items, but am very picky about selecting properties (and owners). Some of the larger companies here like Vacasa or ResortQuest or Southern charge well over 25%. They do not necessarily provide more for the property owners and in many cases they gross less than small, locally-owned boutique management companies. Higher fees are sometime due to higher overhead and large marketing expenses.
Also, some of the larger companies carry in-house cleaning and maintenance services. Again, not necessarily better, just different option. I subcontract those as do most smaller agencies. I suggest that each owner evaluate each management company based on how they fit their needs as opposed to strictly on management fee %. A also manage several properties on a low flat fee basis with the owner being involved a lot more. That option lets the owner keep more revenue, but also requires them to participate more hand on. It is not necessarily right for every owner. Theoretically, some of the larger more expensive management companies should provide more sophisticated accounting and financial interface and reporting analysis. That is not always the case, so again you will need to verify.
My two cents on automating: some items that are not "value adding" need to be automated so save time. However.... vacation rental management is very much about selling the EXPERIENCE, not just the property. Automatic email responses or any communication/interaction with guests needs to be done very cautiously. If a guests sends an inquiry which also includes a specific question like "where can a rent a pack-n-play" and they receive an automated response that does not address their actual question or give them the "feel" of live human communication, they will go elsewhere.
@Paul Sandhu Hey does the fee include furnishing and repair fee?
I don't believe it includes furnishings. It depends on what gets repaired, replacing a toilet flapper = no fee. Replacing a main sewer/gas/electric line = fee.
Investor · The worst town to live in, KS · Member since 2016 · 4k+ posts · 4k+ votes
7y
@Jingru Sui Yes, I believe it includes the cleaning fee. The cleaning fee can also be added on to the rent. Suppose the place rents for $100/night, and there is a $75 cleaning fee. 2 nights would be $275. 7 nights would be $775. You get the idea.
Investor · Orlando, FL · Member since 2012 · 312 posts · 165 votes
7y
some mgmt companies just charge a flat rate.. Around Disney World area i've seen $200 bucks, they just come do a walk through, spray for pest and replace light bulbs.
Investor · Forest Hills, NY · Member since 2014 · 101 posts · 52 votes
7y
@Chai Xiong I've noticed some PMs in the Disney area charge a flat rate of like $200. Why is that? Wouldn't it be more lucrative to charge a percentage of the gross since I'm assuming depending on the place, it'll work out to more. And do you think it's better to work with a PM who charges a % so they have an incentive to have more bookings versus a flat rate where they make the same amount no matter what happens?
Real Estate Agent · Atlanta, GA · Member since 2014 · 683 posts · 317 votes
7y
@Andrew C. Maybe internal management? like the mother company own all the properties and management company will automatically get all the units the mother company acquire. they are manage big volume and make money on other things like cleaning and furnishing?
Investor · Orlando, FL · Member since 2012 · 312 posts · 165 votes
7y
@Andrew C. my guess there's just so many mgmt company competing against each other. Most focus just the mgmt side and leave the booking to a different company.
Boston, MA · Member since 2017 · 209 posts · 126 votes
7y
I would say for STR it is 10-20% and can be as high as 30% we started out at around 10% and kept cleaning fees (since we were managing /paying cleaners.
Rental Property Investor · Member since 2018 · 39 posts · 23 votes
7y
We have a property manager for one of ours, just an individual not a firm. She gets the cleaning fee and 25% of the profit from the stay. We pay extra for maintenance that her husband handles when it arises.
Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
7y
There is a lot of guessing going on. I called Vacasa to see what it would cost to do full management of our North Idaho lake house. It was 40% of gross. That is a lot of dough. They would handle everything from cleaning, maintenance, listings etc. I would have to do zero work. Still too much. No chance of making any kind of profit.