I've been studying the Dallas, Tx market and surrounding areas. I'm looking at buying some single family homes in the area. I'm not sure what a typical property management company charges there. Does anyone happen to know the average cost or percentage per month? Also, if you recommend any particular company that information would be greatly appreciated as well.
Thank you! (I'm just starting out).
Average seems to be 8-10% of income. Most PM software allows you to select which accounts management fees apply to.
Nationwide, the management fee ranged from 6-12 percent, with 8-10 percent most common.
@Brittney Johnson I may have a bit of a jaded view being a property manager but I would focus on Value over Cost.
There may be PM's in the area that charge a lower fee but may not be as accessible for your questions or may not respond as quickly to your prospective renters.
@Jim Murray is right. From what I have observed in the CT and NY markets the property management companies that do charge the ever so enticing 5-8% generally do not have as good communication with investors, and will also up charge / fee the owner to death. Example, a toilet backs up and a plumber bills the PM company $100. The PM company will then bill the owner $120, thus making a $20 spread for essentially "managing" the calling of the plumber.
There is value in finding a PM that is easy to reach, communicates well, can accurately do the books, and finds good tenants. I am a property manager, however, so I am also a bit biased.
@Filipe Pereira Sometimes us property managers get a bad rap so we need to stick together!
I see the same price gauging in my area on maintenance too.
Thank you for all the feedback! Much appreciated.
Hi Brittney! I am also starting out in the DFW Market, but not new to investing. In Nashville, where my other properties are located the typical management fee is as mentioned 8-10% of gross rents, however, what I do see a lot of variation in is the "lease fee" the percent of the first months rent to procure the tenant. In Nashville, it is typically 50% of the first months rent. In DFW i'm surprised that some companies are charging 100% of the first months rent as well as "feeing you to death"
Being out of state some of this is un avoidable as you can't really double check their work. That is what I'm finding out the hard way with repairs and such.
I did find someone in DFW who said they would take 75% of the first months rent and a 8% fee, but after I asked for a few changes in the management agreement they turned me down :-) I DEFINITELY DO NOT want to use a company that can't even have a reasonable conversation with me and be able to justify their fees. If they could I would be happy to pay.
Have you found any quality / reasonably priced management companies?
Anyone else have any recommendations in the DFW area?
Anyone who wants management in Nashville that aligns with your interests, contact me. We offer 10% management fee WITH NO LEASING FEE. We believe we should have the same interests as the investor. There are no other junk fees either.
For the best companies it will likely be 10% a month and 1month rent for the initial lease fee. One alternative is to manage yourself and just use a realtor to get it leased. You can always add property management at any time. You can also add al-la-carte services as needed such as eviction processors if you ever get to that point.
I think there are a lot of great areas where property managers add value, but no one ever raves about their property manager. For an example they're typically great at collecting late fees and penalties vs individual owners who I see let them slide for free too often.
These days I hear a lot of complaints about the PM putting just about anyone who applies in a place, so you might ask about guarantee tenants? Will they replace for FREE?
Another trick I've seen lately is that you want to be sure they put the property in MLS. They may have their own demand, but likely you'll get more choice, and better apps if you open to the market, then just allow them to privately place.
I'd be happy to give you my recommendations if you PM me.
Hi @Brittney Johnson Have you found good PM that you like enough to hire? I'm looking myself and could use some recommendations. @Bruce Lynn
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