There are a lot of different ways that property management companies in Utah charge their fees. You can not assume that if you compare the property management fee charged on the monthly rental amount, whether a percentage or a set fee, that you're making a legitimate comparison. Most Utah property management companies break their fees up so that they can increase their earnings while having the ability to say they charge 8% or 10% when in reality they are really making somewhere close to 12%-15% when you total up all of their fees. In this article we're going to discuss the most-common property management fees that you're going to encounter in Utah, and what to keep an eye out for.
Utah Property Management Fees - The management fees
This is the main property management fee that's charged each month as rent is collected on your property.
Things to watch out for: is this fee picked up whether the property management company collects rent or not, or is it only charged as your property manager actually receives rent?
Utah Property Management Fees - Tenant leasing fee
This is a fee that is often charged by property management companies, and it is generally 25%-50% of the first month's rent and is collected to cover things like lease signing and tenant procurement.
Things to watch out for: not all property management firms charge tenant leasing fees. If your renter moves out after 1 year and you're charged a 25% tenant leasing fee, and you are paying your property management company 8% every month, you are actually paying them a 10% management fee. The tenant leasing fee is seen by some as a motivation for a property manager to sign shorter term leases or have an increased rate of turnover.
Utah Property Management Fees - Renter administrative fees
This is a property management fee that's charged to the tenant every month and is generally between 2%-5% every month. This adds to the tenant's rental amount each month. For example, if they are paying $1000, their rent actually comes to $1050, after the fees. That means in the end it might as wel be added to management fee that you are paying each month since it is coming from the rent.
Things to watch out for: This is a management fee, which may not be shared to the property owner by the Utah property management company since it is being charged to the renter and not to the owner.
Utah Property Management Fees - Rental property advertising fees
Some property management firms will charge $0 for advertising and promoting, and some will charge over $500 to rent your property! The vital issue here is value - how much value are you getting in comparison to how much they are charging you to lease your place? Is it worth the cost?
Things to watch out for: most property management companies do not have a good system in place for advertising and promoting. They will stick a sign in the front yard and place your property on their Utah property management company site, and that's it. But unless you are getting full exposure on websites where people actually visit, out-of-state buyers and in-state renters, it's tricky to know if you really need to lower your price or if you are really getting applications from the most qualified renters that you can.
Utah Property Management Fees - The management fees
This is the main property management fee that's charged each month as rent is collected on your property.
Things to watch out for: is this fee picked up whether the property management company collects rent or not, or is it only charged as your property manager actually receives rent?
Utah Property Management Fees - Tenant leasing fee
This is a fee that is often charged by property management companies, and it is generally 25%-50% of the first month's rent and is collected to cover things like lease signing and tenant procurement.
Things to watch out for: not all property management firms charge tenant leasing fees. If your renter moves out after 1 year and you're charged a 25% tenant leasing fee, and you are paying your property management company 8% every month, you are actually paying them a 10% management fee. The tenant leasing fee is seen by some as a motivation for a property manager to sign shorter term leases or have an increased rate of turnover.
Utah Property Management Fees - Renter administrative fees
This is a property management fee that's charged to the tenant every month and is generally between 2%-5% every month. This adds to the tenant's rental amount each month. For example, if they are paying $1000, their rent actually comes to $1050, after the fees. That means in the end it might as wel be added to management fee that you are paying each month since it is coming from the rent.
Things to watch out for: This is a management fee, which may not be shared to the property owner by the Utah property management company since it is being charged to the renter and not to the owner.
Utah Property Management Fees - Rental property advertising fees
Some property management firms will charge $0 for advertising and promoting, and some will charge over $500 to rent your property! The vital issue here is value - how much value are you getting in comparison to how much they are charging you to lease your place? Is it worth the cost?
Things to watch out for: most property management companies do not have a good system in place for advertising and promoting. They will stick a sign in the front yard and place your property on their Utah property management company site, and that's it. But unless you are getting full exposure on websites where people actually visit, out-of-state buyers and in-state renters, it's tricky to know if you really need to lower your price or if you are really getting applications from the most qualified renters that you can.
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All of these fees can add up quickly to lots of money one way or another and really make the difference of your property having a positive ROI or a negative ROI. It is important when you consider a property management company, that you know all the details and fees involved, and watch out for the things shared above. Go here to let me know if you have any other questions or if want help with your place click Utah property management.
Property management is a nice process of supervising and managing different types of properties such as residential, commercial etc. Here I get such valuable information about Utah Property Management Fees. Thanks for sharing.
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