So what does my 10% management fee cover?
Well… not that much with some companies. I have worked with both corporate letting agents and family run property management companies and, in my experience, you don’t get much for your 8-10% management fee.
While working for one company I arranged for a new bathroom to be installed at a cost of £5000. I was told by the boss to add £500 to the bill (this is normal practice to add 10% for arranging maintenance) then told to raise another invoice for 2 hours at £54 + VAT for arranging the job. This was for a fully managed client.
Another example… My parents have a couple of properties out with my local area and use an agent to look after them. Recently they were charged £18 to top up an electric card. They also pay 10% monthly. I should add this company charges 20% to arrange maintenance.
Now, you pay for the let separately, which includes advertising, viewings, referencing, credit checks, lease, inventory and check in. Then you pay your property management fee. THEN with some property management companies you also pay for a check out report AND any time spent on any deposit disputes.
So I ask again WHAT do you get for your management fee?
Well, I guess the answer is every company is different. My advice is to make sure you check what’s included and what you pay extra for and negotiate hard before you sign a contract. If you can deal with the 10pm message to say the roof is leaking or the hot water isn’t working you could consider just going for a let only service and manage the property yourself.
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