What your property management fees pay for
Just like running a business, owning an investment property involves income and expenses. And if your property is professionally managed by a real estate agency, one of those expenses is the property management fee.
But how much is that fee and what exactly does it cover? Here, we walk you through what your property management fees pay for and why they’re a small price to pay for peace of mind.
The average cost of PM fees
As realestate.com.au explains, property management fees vary from agency to agency and state to state.
In some regional areas they can be as little as 5 per cent of the property’s weekly rent, while elsewhere they can equate to 12 per cent.
These fees can also be structured differently, depending on the agency.
In some instances, there will be an all-encompassing property management fee with everything included.
In others, there might be a traditional management fee and an additional letting fee, which covers the changeover of a rental agreement.
In some cases, the agency might charge a flat fee for service.
What the fees pay for
Taken from the property’s rental income, property management fees cover a whole host of tasks which the property manager undertakes on the property owner’s behalf, including:
- Advertising the property for rent
- Organising and managing rental property viewings
- Screening prospective tenants
- Handling the rental agreement
- Managing the condition report process when renters enter or exit the property
- Routine inspections of the property, including providing reports to the owner
- Reconciling the accounts and disbursing rental payments to the owner
- Organising any required repairs or maintenance with tradespeople
The fee is tax deductible
In most instances, the property management fee is tax deductible.
This means at the end of each financial year the property owner can offset the expense of property management fees against the property’s income to reduce the taxable income of the asset.
The true value of a property manager
While a property manager performs numerous tasks on behalf of the owner, their true value lies in the fact they save property owners time and stress.
Key to the property manager’s role is the fact they act as an intermediary between the owner and the rental occupier, and this eliminates a whole host of headaches for all involved.
In the process, they ensure the investment is looked after, receives the income it should, and all parties are aware of their rights and responsibilities.
Meanwhile, the property manager’s job is to stay abreast of the relevant rental law, which changes over time.
It’s worth the investment
A great property manager saves owners time, effort and stress when it comes to managing a rental property, and an ongoing monthly fee is a small price to pay for peace of mind.
Find the right property manager and you can rest assured your asset is in safe hands, with the property manager handling the day-to-day administration of the asset, while the owner enjoys the income it commands.
How we can assist
Our experienced property managers pride themselves on establishing great relationships with both rental occupiers and owners.
We manage every property as if it were our own and you can learn more about our property management services here.
Alternatively, if you are looking to rent a property, you can view the properties we currently have available here.
