How much do you pay for property management in PERTH?

[ipinvestor]

Hi,
This is my first post in 2011. Our 4th IP settled on 25th Jan 2011. I sent an email to our property manager and asked her to send me property management contract with a good deal.
(1)We pay 8.5% management fee. When I read the contract, I foundout that the contract say, 8.5% of all money received. Does it mean they charge 8.5% of rent, 4 weeks deposit/bonds, any water charges received from tenant?
I think, it should be rent only. Can anybody help me?
(2) We pay two rents as leasing fee. She offered me one week leasing fee for all 4 IPs if I sign the new contracts for next two years.
(3) $150 for property report, that includes DVD but we never received DVD. Do they keep it for their records?
(4) $40 for 3 monthly inspection.
-------------------------------------------
I am thinking to ask for (1) 7.5% of rent received only (2) 1 week leasing fee
What are your thoughts.
Regards.

 

[russellpeter]

ouch

that a lot of commission

you have the other 3 investment properties with them and are happy with their service?

I would ask them for a copy of all the DVD's and if they can’t supply ask why you are paying $150 and ask for your money back.

I don’t know about WA but QLD the standard is 7.5%+gst and 1 weeks rent as letting fee.

no you shouldn’t pay commission on bond money

 

[Goofy]

damn i wish i could get those kind of fees in Victoria!!

with multiple properties should be able to negotiate a bit of the fees, and if you dont ask you wont receive so there is no harm in asking!!

 

[jaycee]

I worked out that my last PM would have charge around 18% of total rent to bring in and exit a new tenant after a 12 mth leaase

 

[bene313]

This has been discussed a bit in the past if you want to do a search. From memory, Jaycee is about right - around 18% all inclusive.

 

[ipinvestor]

Thanks a lot for response but Isn't there anybody from Perth who can advice me?
Thanks again.................

 

[jaycee]

Thanks a lot for response but Isn't there anybody from Perth who can advice me?
Thanks again.................

Hi ipinvestor, please see my response above. The pricing was worked out January 2010 for my villa in Balga.

8.5% + GST management fee
plus postage & Petties per month
+ initial lease etc to get tenant
+ initial inspection
+ one interim inspection
+ exit inspection & whatever else involved in getting a tenant out
? cannot remember if I included costs to advertise for tenant or not ?

Added up to around 16 or 18% of total rent p.a. when I added it all up.

Re the DVD - they probably keep it on file. When my exPM sent over my file, it included a cd of photos. While they are managing it, you mightn't necessarily need the copy I guess. Can't imagine why they would say no if you asked for it or for a copy though.

 

[Xenia]

we did a study in 09 in SA, looking at the balance sheets of some property investors and found that it costs around 19.2% to have properties professionally managed even when the agency was charging 7.7 or 8.8%.

a one week letting fee is 2.2% of your annual income and that needs to be tallied into the whole calculation. - there is more than just property management fees.

 

[jokerjoe]

Hi,
This is my first post in 2011. Our 4th IP settled on 25th Jan 2011. I sent an email to our property manager and asked her to send me property management contract with a good deal.
(1)We pay 8.5% management fee. When I read the contract, I foundout that the contract say, 8.5% of all money received. Does it mean they charge 8.5% of rent, 4 weeks deposit/bonds, any water charges received from tenant?
I think, it should be rent only. Can anybody help me?
(2) We pay two rents as leasing fee. She offered me one week leasing fee for all 4 IPs if I sign the new contracts for next two years.
(3) $150 for property report, that includes DVD but we never received DVD. Do they keep it for their records?
(4) $40 for 3 monthly inspection.
-------------------------------------------
I am thinking to ask for (1) 7.5% of rent received only (2) 1 week leasing fee
What are your thoughts.
Regards.

We pay 8.5% in QLD.
They do not charge a leasing fee at all. Not at initial tenant signup and certainly not at lease renewal like alot of agents do.

$40 for 3 monthly inspection --- I have never heard of this... what do you pay the week to week payment for?????!!!!!!!! Crazy!
Is this common elsewhere??

The 18% that people are quoting is scary. It shows there is a fundamental problem with management fees. Who carries the risk? -the landlord. I'd love a 18% yield p I know some here attain that but I don't)

 

[Beef_Hooked]

PM's in WA are in a league of their own.

After talking to several PM's it begins to look suspiciously like price fixing going on in the areas I am involved, there is certainly no competition between agencies.

My first choice turned out to be all style and zero substance. I won't mention the name of the agency in Mandurah but when you walk in you'd be forgiven for thinking you had walked into a modelling agency, locals probably know who I mean. 12 weeks of advertising at my cost and zero results. Luckily I was able to terminate the 12 month agreement without further losses.

Lesson1: Ignore the bimbos and go straight for the mature headmistress types. Even when you find someone with er... balls, you will probably find you have 3 different PM's each year. They get paid peanuts and have a huge roll to oversee, so the turnover is constant.

Lesson 2: Negotiations are something the PM will not enter into, they have no autonomy. Every question regarding the fees has to be directed to the Principle or some other phantom like figure that never seems accessible. Don't hold your breath waiting for a reply.

I'd type out my costs but it would spoil my day to read it through.
See thread here. I'd say 20% is fairly conservative if the rental value isn't high as the charges are what sucks up the money not the percentage quoted for management fees.

I started with a tennant 1/2 way through the financial year and the figures were 46% for the first 6 months .

Luckily I have held onto a tenant for 2 years now but I wouldn't be game to put up the rent, lose them and wait another 12 weeks for the PM to find someone..... and then charge all the letting fees etc. again.

If you want high yield in WA and have the skills, don't buy a property, buy a rent roll, money for jam and no risks involved at all.

Cheers,
Beef

 

[yadreamin]

I will ruin my day and type out all the recent charges for my PM in Mandurah.
advertising for tenant Up to$300
leasing fee =2 weeks rent
management fee 9.35% gross collections of monies
property condition report $110
final bond inspection fee $77
inventory report $65 per hour + GST
routine inspection report. 3 monthly $49.50
fixed lease renewal $100
annual financil sumary $22
court /tribunal attendence $88 per hour ,$264 per claim against tenant
meeting attendence $88 per hour [BC meetings]
title search fee $18.50
tenant enquiry fee $50
postage and petties $6.60 per month
And the one that really gets up my nose is all the added GST thats charged to me.
note that all of the above is negotiable but from my experience there isnt much give .
cheers
yadreamin

 

[jaycee]

I will ruin my day and type out all the recent charges for my PM in Mandurah.
advertising for tenant Up to$300
leasing fee =2 weeks rent
management fee 9.35% gross collections of monies
property condition report $110
final bond inspection fee $77
inventory report $65 per hour + GST
routine inspection report. 3 monthly $49.50
fixed lease renewal $100
annual financil sumary $22
court /tribunal attendence $88 per hour ,$264 per claim against tenant
meeting attendence $88 per hour [BC meetings]
title search fee $18.50
tenant enquiry fee $50
postage and petties $6.60 per month
And the one that really gets up my nose is all the added GST thats charged to me.
note that all of the above is negotiable but from my experience there isnt much give .cheers
yadreamin

Agreed, casue as Beeff Hooked suggested,the PM hs no autonomy so their goal is to get you signed up... so don't worry about it.. she's a nice person, I'm sure it will be fine

annual sumamry is something I always ticked NO on the contract, but at the end of the financial year i'd find I didnt have all the stamtents. Each time I asked for one, it was sent to me free. Without having to negotiate, just sent a quick email asking...

 

[yadreamin]

I always get the summary but its free.
I dont pay Postage and petties
I have had claims in the tribunal and didnt get charged a fee from the PM
I have never been charged a fee for bond claims
l dont pay inventory report fees
dont pay tenant enquiry fee
dont pay advertising for a new tenant
All l can say is dont just acept their charges as most of the REAs have woken up in the last 2 years to the fact that when sales are dead rent rolls are their bread and butter plus its a fairly comptetive scene here.
cheers

 

[ipinvestor]

Thank you very much you all for your post but I am still confused, I read all posts twice and the summary is....I have got no choice but the RE Agent (same). Because no one from WA pays less than what I pay. What I am planning to do next week is I will visit 5-6 RE agents and ask them How much they will charge me for managing 4 properties.
I will let you know the outcome of my exercise.

 

[Rixter]

My WA PM fees vary from 6.5 to 7%.

 

[jezza]

Hi,
This is my first post in 2011. Our 4th IP settled on 25th Jan 2011. I sent an email to our property manager and asked her to send me property management contract with a good deal.
(1)We pay 8.5% management fee. When I read the contract, I foundout that the contract say, 8.5% of all money received. Does it mean they charge 8.5% of rent, 4 weeks deposit/bonds, any water charges received from tenant?
I think, it should be rent only. Can anybody help me?
(2) We pay two rents as leasing fee. She offered me one week leasing fee for all 4 IPs if I sign the new contracts for next two years.
(3) $150 for property report, that includes DVD but we never received DVD. Do they keep it for their records?
(4) $40 for 3 monthly inspection.
-------------------------------------------
I am thinking to ask for (1) 7.5% of rent received only (2) 1 week leasing fee
What are your thoughts.
Regards.

Are you happy with the service, I have 1 PM that looks after 3 of my properties and the reality is I would actually pay them more but I started at 7.7% with them, then when I gave her another they charged 6.6% and with the 3rd they made it 5.5%. I don't pay for any inspections, condition reports, renewal leases, statements, postage etc. I pay 1.5 weeks if tenant moves out and they find another one, $120 in advertising if needed and a background check on tenants which I think is about $40

As I stated at the start, it really isn't about the money though this PM is fantastic and she sends me emails on things that need updating or just wants to keep me informed on conversations she has with tenants

Other IP's scattered about are generally around 6.6 - 7.7% and I generally cross out all the added extra charges which so far has never been challenged.

Get your hands on some of these DVD's for $150 I hope they include a bootlegged movie because most PM's know how to use a camera and fill in a form and that's worked perfectly.

I would challenge there fee's if they are only doing there job and see what response you get, if not ask around other PM's

Jezza

 

[Dazz]

.
advertising for tenant Up to$300
leasing fee =2 weeks rent
management fee 9.35% gross collections of monies
property condition report $110
final bond inspection fee $77
inventory report $65 per hour + GST
routine inspection report. 3 monthly $49.50
fixed lease renewal $100
annual financil sumary $22
court /tribunal attendence $88 per hour ,$264 per claim against tenant
meeting attendence $88 per hour [BC meetings]
title search fee $18.50
tenant enquiry fee $50
postage and petties $6.60 per month
And the one that really gets up my nose is all the added GST thats charged

Yep, that's the "standard" recommended by REIWA to their members.

Price collusion is alive and well. This furphy of "well if you aren't happy just sack 'em and go somewhere else" is a furphy. Everyone else down the road is also a member of REIWA and starts every negotiation with this as well.

The tactic of putting a non-authorised donkey in the front nodding as she speaks "I'm sorry, our fees are non-negotiable. Now lets talk about the massive value we can add to your most precious investment."

HA !! Bollocks to that. We got charged 22.3% pa all up when we used PMs. Of course, PMs cannot and will not PM, cos the title they latched onto is a misnomer.....but that's a whole different kettle of wax.

WA PMs begone.

 

[jaycee]

Yep, that's the "standard" recommended by REIWA to their members.

Price collusion is alive and well. This furphy of "well if you aren't happy just sack 'em and go somewhere else" is a furphy. Everyone else down the road is also a member of REIWA and starts every negotiation with this as well.

The tactic of putting a non-authorised donkey in the front nodding as she speaks "I'm sorry, our fees are non-negotiable. Now lets talk about the massive value we can add to your most precious investment."

HA !! Bollocks to that. We got charged 22.3% pa all up when we used PMs. Of course, PMs cannot and will not PM, cos the title they latched onto is a misnomer.....but that's a whole different kettle of wax.

WA PMs begone.

Oh come on now... that's only like.... about .... 100% true and correct

 

[redwing]

I always get the summary but its free.
I dont pay Postage and petties
I have had claims in the tribunal and didnt get charged a fee from the PM
I have never been charged a fee for bond claims
l dont pay inventory report fees
dont pay tenant enquiry fee
dont pay advertising for a new tenant
All l can say is dont just acept their charges as most of the REAs have woken up in the last 2 years to the fact that when sales are dead rent rolls are their bread and butter plus its a fairly comptetive scene here.
cheers

Hi yadreamin, I'm confused, that seems contrary to your previous post (but good news nonetheless)

My WA PM fees vary from 6.5 to 7%.

From 3.0% up to 8.5%

As Dazz said the negotiations start at Yadreamins original fees and add ons

 

[catcha]

This is what my PM charges in Darwin

Management Fee: 10% + GST

Fee: $8.00 per month + GST

Hourly rate attendance charge Body Corporate Meetings: $75.00 per hour + GST

Tribunal Hearing attendance $75.00 per hour + GST

Advertising: Charged directly to owner for payment
* Saturday NT News $38.00 per advert + GST
* Internet $40.00 per upload + GST includes feature

property on realestate.com
raywhite.com.au
realestate.com.au
rentfind.com.au
Inventory Charges: Negotiable
Condition Report: No Charge
Inspection Fee: No Charge
Renewal Fee: No Charge
Annual Statement: No Charge

Might have to think twice about investing in WA