PM agency getting kickbacks from tradies?

Hi All,

Does anybody know if PM agencies get kickbacks from tradies?

I just got quoted $270 to replace a range hood and an additional $65 to fix a power point ($335 !!). I spoke to my electrician who will likely do all of this in ~$230 or so. This is a big difference between agency electrician & mine (though I think even $230 is high for the job it is).

Should the agency be declaring any commissions they receive?

Bunnings -
HPM DGPO $27.52 or DETA (10pack) $59.00
Everdure SS 60cm range hood $129

So there goes $135-160 in parts alone.

Call out fee + 1 hr extra labour to install $150-$180 (pick up from supplier/ring around etc)

Rubbish removal/disposal $10-20

So anywhere between $295 - $360
I've seen variances of 100% on quotes between 2.5-5k. I wouldn't worry about such a small $ variance for a rangehood install, chump change.
No tradies do not give kickbacks to PMs

In 20years of doing trade work for countless real estate agencies, we have never been asked to pay anything to the PM. All invoices are made out directly to the owner.
Just paid an electrician and his apprentice for 1 hr labour-$66
including taxes..the bill came to $85.48

I like our prices better :)
Pm can get kick backs but it has to be outlined on the PAMD 20a

I know of a couple of agencies that do have a 10% charge on all maintenance.

but if not outlined on the agreement big fines and can result in loss of licence

Pure Rentals receives no Kickback from any third party supplier.

my thoughts are we get paid to manage your property not to refer you to a supplier that has the best kickbacks.
Ive not had any PM's declare or get kickbacks. Most trades employed by PM's value the repeat ongoing business and so are reasonably priced.

With electrical and plumbing, there can be a wide variance in hourly rates and materials markup which is where the difference usually lies.

The sparky I use is $88 an hour but has small markup on materials. Or you can get Dodgy Habibs Electrical who charge $44 an hour but high materials markup so the same job will vary depending on the mix of labour to materials.

Also consider that agency electricians will assume it will take up to a month to get paid from funds held at the agency or by the owner, so they may load the rate a bit to cover the longer time to get paid.

As a comparison, I know that a replacement 600mm rangehood costs me $85, power point $20, and then another $88-$122 for install if its in my sparkies local area, so about the $230 mark like your guy quoted.
I am not aware of agencies getting kickbacks either. And as others have said, the tradie's used, know that to lose a steady client is not in their best interests. On the other hand, ask who is going to pick up the new appliance, and what is going to be done with the old one. Some stores will deliver, for a fee, however the tenant will need to be home at delivery time. If as an owner you are happy to assist, then yes the tradie can get the job done in less time, and for a lessor fee.
Seems like a reasonable change over price to me.

I have been a PM for some time and not once have I ever received a kickback from a trade and nor would I accept as I would prefer to pass savings on to my landlords than charge more to get anything in my pocket.

Most of my trades I have worked with for several years and I trust them to charge an amount which is fair and reasonable. It gets the job done but still puts some food on their table without charging the owner an exorbitant amount.
Many suppliers offer incentives to receive work. I wouldn't class them all as "kickbacks"....The handyman might do some freebies around the office as a way of saying thanks. You would hope they don't load your fee to do free work elsewhere though.

That said we recently found a major scam in some strata insurance policies. We warned a few client and ALL of them had the same problem.

The broker who specialised in strata policies wasn't shopping round and was actually very expensive and was also earning commission that wasn't disclosed or approved. So it looks like a round robin scam to fleece strata's to benefit the broker.

The quoted price also includes the cost of lots of quotes which aren't invoiced !, travel time and time taken to go buy parts, phone calls etc etc...

If the cost exceeds $X it probably should get two quotes - Discuss the PM policy with them. I'm sure they have one.