More Appealing Property Management Compensation Model

Property management is expensive.  In this area it looks like the typical model is 1 months rent plus 10% of monthly - if you are both getting tenants and managing with the agency.  

The first year is brutal for the landlord - %18.333 of the gross rents go to the agency.  Even worse the incentive for the agency is to keep turning over the unit - even if 50% of the listing fee is shared - they get over 4 months worth of management fees for a new lease.

As expensive as these fees are to the landlord - I am not sure there is a ton of discounting that is possible.  However changing the compensation structure could align incentives better.  I think 1/2 the rent needs to be charged at turnover, so they can comp with a renters agent.  However if the listing fee is rolled into the monthly fee it ends up being roughly 14% of the monthly rent.  That means the money for the landlord and the agent is in having long-term tenants.