Working with a property manager makes it possible for you to manage your real estate more efficiently, especially if it’s not where you currently live. This means you can choose to invest in areas with exciting growth potential. One area that we have our sights on is Huntsville, AL, where home prices increased 22.1% in a single year compared to the national average of 14.7%. Huntsville is such an exciting market to invest in right now!
The cost of hiring a property manager depends on your location and several other variables, such as the type of rental and the number of services you’re looking for. In this article, we examine five different property management companies in Huntsville and the various fees they charge so you can get an idea of what to expect!
Leasing Fees for Huntsville Landlords
Most property managers charge a leasing fee to reflect the time and effort spent finding a resident for the rental property. The services covered by this fee may include:
Marketing the property
Holding showings
Screening applicants
Preparing the lease agreement
If you prefer, you can hire a property manager only during this leasing period, opting to handle the ongoing management yourself after a resident is placed.
Some leasing fees are charged at a flat rate, but more typically, they are calculated as a percentage of the first month’s rent. In the Huntsville area, a leasing fee can run from 10% to 75% of your first month’s rent or from $350 to $1000. Evernest’s leasing fee is 50% of one month’s rent with a $500 minimum.
Fixed vs. Percentage-based Property Management Fees in Huntsville
To have a property manager oversee your rental property for you, you’ll pay a monthly management fee. Here, prices will vary as a result of the services included — this is why it’s less important to just choose the cheapest option and more important to look into what services are included in the cost.
The cost of property management may be a fixed charge or a percentage fee, depending on the company you work with. A percentage fee is a proportion of your monthly rent, whereas a flat fee is a fixed amount you’ll pay each month.
In Huntsville, flat fees will be around $99 per month, whereas percentage fees can range from 8-10%. The factors that determine these fees include the price of your rent, the type of property you own, and the scope of services your property manager provides.
Some property managers will reduce their fees if you choose them to manage multiple properties for you — Evernest, for example, reduces our fee from 10% to 8% of your monthly rent if we manage 5 or more of your properties.
Repairs and Maintenance Fees
Some property management companies will handle repairs and routine maintenance for you. This can be a good option because a property manager may have connections with local suppliers and contractors that enable them to negotiate a cheaper price than you would be able to get on your own.
You’ll also find that a lot of property managers will organize the completion of certain repairs as needed. To cover this, you will have to set aside a certain amount of money in a reserve repair fund. The minimum amount that must remain in your reserve repair fund and the procedures for authorizing the use of these funds will be outlined in your property management agreement.
Leasing Renewal Fees
When your resident’s lease is up, most property managers will charge a fee to cover the cost of negotiating and completing lease renewal documents with residents who choose to stay in your rental. Similar to the leasing fee, this can be a flat fee or a percentage of the monthly rent. For some property managers, the lease renewal fee will be waived altogether.
At Evernest, our lease renewal fee is just $250.
Vacant Unit Fees
If your unit is vacant, your property management company may continue to charge their full monthly management fee, or they may charge a separate vacant unit fee.
Eviction Fees
While it’s not common, you may find yourself in a situation where you need to evict a resident. Resident evictions can be handled by your property manager. Some charge a fee to do this, while others offer an eviction guarantee with their premium membership tiers.
At Evernest, we offer an Eviction Protection Plan, which can help cover your expenses in the event of an eviction. We will cover all attorney fees, court costs, and set out charges associated with evicting your resident. We will also change out your locks. The cost of EPP is $200 per year, billed annually.
Routine Inspection Fees
Routine inspections are vital to guarantee that your resident’s rental is well-maintained and detect problems before they turn into costly repairs. Depending on your property manager, you may be charged an additional fee for periodic or move-out inspections.
In Huntsville, move-in and move-out inspections are generally included with the leasing or monthly property management fees.
Contract Termination Fees
Some companies will charge an early termination fee if you choose to end your contract with your property manager early. These fees can vary greatly, so be sure to know your property manager’s policy.
At Evernest, we think that if you’re dissatisfied, you should be able to terminate your contract with us at any time. That’s our 100% Happiness Guarantee.
Factors Affecting Property Management Fees
Because there are multiple factors that might impact the fees your property manager charges you, we’ve listed many of the costs above as ranges. These are the factors that might affect your total fees:
Property type: Your property manager’s fees will differ depending on whether your rental property is a single-family house, a multi-family apartment complex, or a commercial property.
Property size: Fees can be influenced by property size because larger properties may need more care (maintenance and upkeep) than smaller properties.
Property condition: A newly constructed or remodeled home may require less maintenance than an older one.
Neighborhood rating: If your rental property is in a high-rent neighborhood, your property manager may charge more than if it is in a low-rent zone.
Market competition: If there is less competition in your area for property managers, they may be able to demand higher rates.\
The extent of services: Finally, the extent of services your property management supplies influences the fees they charge. Rent collection, for example, takes significantly less investment from a property manager than providing 24-hour resident communication, maintenance management, and financial reports.
Hire Evernest As Your Huntsville Property Manager
If you’re excited to invest in the Huntsville market, hiring the right property manager will help you build your business and achieve the real estate outcomes you want.
Evernest has made it our purpose to support our property owners in achieving a consistent return on their investment, hassle-free. Learn more about our Huntsville property management services and pricing here.
Source: This article was originally written for Evernest and published at Evernest.co.
