Property Management Fees – What should I pay my Property Manager?
Property Manager Fees – What is typical for Victoria?
As we have many clients who are new to investing or are investors who have previously invested interstate and are used to different pricing schedules I thought it may be helpful to do a post addressing what is typical for Victoria.
The amounts mentioned in this article are based on reviewing many fee schedules for our clients each and every year. It is an average and designed to illustrate typical fee schedules. Not all fee schedules will be identical as there are many different ways a property manager may elect to propose their fees. This article will give you a good guide as a starting place
Property Management in Victoria is made up of several different fees
The other fees you will see when you first list your property for rent are:
Uncommon fees may also include:
- Arranging repairs, maintenance, or improvements
- Reference checking
- Phone calls made on your behalf
When weighing up the management costs it is important to look at the whole picture, not just the weekly management percentage.
Compare all the fees and how often each fee would apply, or would likely apply, and work out the total amount before deciding on an agent purely based on fees.
Having said that, I personally would prefer to pay an outstanding manager a higher amount to look after my investment rather than pay the cheapest manager just because their fees were lower. I don’t shop for fees, I hire based on an interview process and then negotiate fees to a “fair” amount that I am happy to (fair, meaning I pay them the amount that is recognizing the value they offer in the process)
Here is an example of three different rental fee schedules to illustrate the point about not shopping just for the cheapest management fee so you can see how they compare side by side. For simplicity I have only included basic fees that are very common.
It’s important to remember that there are many fees that make up a whole fee proposal. Some of the fees can easily (and fairly) be negotiated out, others are not easily removed. Assess all fee proposals in their entirety and remember to hire based on experience not on fees alone. It doesn’t require skill to offer the cheapest service, but it does take a lot of skill and experience to do a great job.
I will write about what you should expect to experience when working with a great property manager in weeks to come.
In the mean time I hope this has been helpful. Please feel free to share with friends looking to buy an investment property in Melbourne.
If you would like to find out more about how the service works and if it’s right for you Phone 03 8680 2377 to book an obligation free chat.