Rates for property management

[Kenan]

We are looking for a property manager (Melbourne CBD) and so far the rates including all management as we will be overseas are coming in between 8%-10%.

I am a little surprised it is that high, am I not finding the right property managers? Maybe they just dont need the work? I know I charge absurdly high when I dont want the contract

 

[Goofy]

10%???? damn i need to start increasing my rates!!

Is that for the monthly management fee? or all inclusive? What type of property are you leasing out?

Fees should range between:
*Monthly Management Fee - Cheap 5% - 7% (depends on how expensive the property is, if it is fully furnished, if you have multiple properties etc)

*Leasing Fee = 1 week rent - 3% annual rental

*Advertising - really depends on what you choose, internet listings only should be around $150 mark

*Re-leasing fee - not charged - 1.5 weeks rental

*Statement Fees - $3-$5.00

NB: all fees above are exclusive of GST

Hope this helps

 

[Cdro]

I am in Sydney, but understand rates are fairly similar. I am paying about the same as Goofy's numbers:

- 5.5% management fee (but when I got quotes, they ranged from 5.5 - 7)
- 1 week rent letting fee
- internet advertising
- $5 statement fee
- and a couple of extras that hopefully we'll never pay (eg. an hourly rate if they have to attend the tribunal)

Talk to a few different agents, and choose the best one. Then ask if they will bring their fees into line with the market and your expectations.

I've seen mixed views on these forums about negotiating fees. My view is that, if you can see that one PM is clearly the best, they deserve the chance to win your business, even if it means dropping their fees. (Of course, I think it's important to respect their right to say no!)

 

[Jamie M]

In Canberra 8% to 10% is the norm.

Cheers

Jamie

 

[Kenan]

6.6 - 10%

The monthly management fee has ranged between 6.6 and 10% for all of the Melbourne CBD based places I have contacted. With the 6.6% quote being far lower than the others.

Not sure how true this is, however I have been told by someone who knows more than me that there are so many apartments being rented in the CBD at the moment, that the property managers are not desperate for business at the moment.

 

[The Y-man]

We pay 7.7% (inc gst) for CBD fringe. We used to pay 5.5% to another lot, but in essence we got what we paid for.....

The Y-man

 

[dc_prs]

You can certainly find cheaper, say 5 - 5.5%, but you should really understand the service being offered. E.g. how and when are inspections done. Understanding what their service includes will enable you to make better comparisons.

 

[Sez]

Sorry to be the bearer of bad news but in the CBD this is fairly usual! I work further down around Frankston and my average is 5.5% - 6.6% but the closer you get to the city the higher your management fees get. My advise if you want something cheaper is if you are able to engage an agency which is slightly outside the CBD but still close enough to mange your property well. They may be willing to do a lower management fee for you as they are picking up a great property in a good area.

I also agree with Goofy - Maybe we are selling ourselves too cheap!!

 

[russellpeter]

Im in brisbane and have a flat rate of $1249pa + GST
1 weeks rent as a let fee
no other charges

 

[russellpeter]

your property management fee at a rate that is both profitable for you and appealing to potential customers can be tricky. While standard property management fees today are set at 10 percent of a unit’s monthly rent rate.

A percentage fee structure assumes that it takes more time to manage a property with a higher rent, so costs are higher. Consider this, if you own two properties with the same number of bedrooms and one rents for $300pw and the other for $600pw, why should you have to pay double the fees for the $600 property?

The same amount of work needs to be done with both properties - they have the same bond forms, same tenant applications, same number of property inspections and same number of invoices. With a flat fee structure, you pay the same for both properties despite the difference of rental income.

 

[LilyLou]

I have found with my properties that you really do get what you pay for, from recent experience I have found agents who charge between 5-7% for new managements generally either find other ways to slug you, really suck at what they do or have large rent rolls and harrassed overworked and apathetic staff with high turnover...

In saying that can anyone suggest a great agent that does the Brisbane Metropolitan area? I would do it myself if I had time....

 

[CJS]

I have found with my properties that you really do get what you pay for, from recent experience I have found agents who charge between 5-7% for new managements generally either find other ways to slug you, really suck at what they do or have large rent rolls and harrassed overworked and apathetic staff with high turnover...
....

By way of contrast we got lousy service from the mob charging us 7% and are massively impressed with the mob that charges us 5.5% + statement fee (which still worked out cheaper than the 7%).

 

[younguns]

We have just swapped agents again - 3rd time in 3 years! Our two properties are in Brunswick. Have had 5.5% plus 1 week leasing fee all this time. First two guys were a waste of time. We now have a female property manager and she is great. No offence to the competent male PMs out there but the girls are winning for us On a side note, I can't believe how high the rates are in WA. Try double melbourne!

 

[russellpeter]

I have found with my properties that you really do get what you pay for, from recent experience I have found agents who charge between 5-7% for new managements generally either find other ways to slug you, really suck at what they do or have large rent rolls and harrassed overworked and apathetic staff with high turnover...

In saying that can anyone suggest a great agent that does the Brisbane Metropolitan area? I would do it myself if I had time....

Hi LilyLou

will send you a message would love to help you out.

 

[liverpoolharryk]

I am sure there are plenty of somersoft memebers that have great property managers here in Brissy that can be recommended.

 

[long88]

just want to bring this thread alive again.

what is the current rate for PM fee, my IP is in fr south, on $340/week, rate 6.6% will i be able to find something better ? or is this good already ?

Sorry to be the bearer of bad news but in the CBD this is fairly usual! I work further down around Frankston and my average is 5.5% - 6.6% but the closer you get to the city the higher your management fees get. My advise if you want something cheaper is if you are able to engage an agency which is slightly outside the CBD but still close enough to mange your property well. They may be willing to do a lower management fee for you as they are picking up a great property in a good area.

I also agree with Goofy - Maybe we are selling ourselves too cheap!!

 

[buzzlightyear]

just want to bring this thread alive again.

what is the current rate for PM fee, my IP is in fr south, on $340/week, rate 6.6% will i be able to find something better ? or is this good already ?

I have a dual occ in the area and my fees are the same as yours. Of course there are other additional fees that are becoming more prevalent.

But the net effect of this change to you is $195pa. If you change, who will be managing your property? Do they experience and expertise to manage your property. $195 is gone in an instant through even one poor management episode of a maintenance request.

 

[long88]

i am thinking to move it to another agent, this one, every 6 month different PM (longest is 1 year), and they think that landlord is atm, they just dip their hand into rent with various fee and charges.

what $195 fee that you talking about is this cancellation fee ?

I have a dual occ in the area and my fees are the same as yours. Of course there are other additional fees that are becoming more prevalent.

But the net effect of this change to you is $195pa. If you change, who will be managing your property? Do they experience and expertise to manage your property. $195 is gone in an instant through even one poor management episode of a maintenance request.

 

[buzzlightyear]

i am thinking to move it to another agent, this one, every 6 month different PM (longest is 1 year), and they think that landlord is atm, they just dip their hand into rent with various fee and charges.

what $195 fee that you talking about is this cancellation fee ?

I should have been a little clearer. If for example, you get a rate of 5% plus GST for management fees, then your rate of 6% plus GST, will mean a difference of $195pa of management fees. ie 0.011 x 340 x 52 = $194.48 net saving.

If of course its a service issue, then that's another issue.

Can I ask, what specific impact does changing the PM have on the management of your property?

 

[long88]

Hi Buzzlight

i think changing pm does not have any effect, but it comes to being a greedy PM that is my problem.

so with the other agent, i would like to start over again, knowing what i will be upfront, and negotiated properly, or do you think i will fall into the same trap again ?

I should have been a little clearer. If for example, you get a rate of 5% plus GST for management fees, then your rate of 6% plus GST, will mean a difference of $195pa of management fees. ie 0.011 x 340 x 52 = $194.48 net saving.

If of course its a service issue, then that's another issue.

Can I ask, what specific impact does changing the PM have on the management of your property?