Perth Property Management Fees Explained
The number one question in Property Management: How much should I pay for Property Management?
For property owners, it can be difficult to assess how much reliable Perth property management should cost, as fees and charges vary from one company to the next.
That’s why we’re HERE to help. To understand how property management fees apply to your investment property, contact us today.
What does a good property manager do?
While there could be dozens of real estate agencies that offer property management services in your local area, not all of them will offer the same level of service.
Generally the duties and responsibilities that a good property manager will handle include:
- Determining the accurate rental value of your property
- Advertising to renters and screening prospective tenants
- Inspecting the property regularly and updating you as to its condition
- Ensuring that rent is always paid on time
- Organising trades to perform repairs and maintenance duties on the property
- Liaising with the tenants to deal with any complaints or issues that may arise
- Dealing with difficult tenants, including guiding you through the eviction process if necessary
Your Guide to Perth Property Management Fees
To help you assess your options for hiring a property manager, our guide to choosing the right property manager offers more detail on what to look for in a property manager.
Ongoing Management Fees
The management fee is the main fee you pay to the property manager and is the meat of your contract. It is based only on the amount of rent received and Perth fees currently range from 8.5% to 10%.
As it is one of the larger fees you pay, ensure you consider the stability and experience of the property management team. The management fee covers the day-to-day management tasks of your property manager such as:
- collecting, processing and disbursing rent
- advising the owner of relevant matters
- liaising with tenants
- pursuing late rent and invoice payments
- managing processes for rent arrears
- organising maintenance and quotes
- ensuring compliance with relevant tenancy and safety oriented legislation
Letting or Leasing Fees
The letting fee (or leasing fee) is applied when a property management firm must find a new tenant for your property. Letting and leasing fees in Perth are usually two weeks rent plus GST or 2.2 weeks rent.
The charge covers the cost of finding and securing a tenant for a vacant property and includes:
- an assessment of the rental value
- conducting inspections with prospective tenants
- screening and processing applications
- lease execution
- bond processing and lodgement
At HERE Property the fee also includes orientation interviews with the tenant to advise them of their rights and responsibilities, explanation of the lease in detail and signing of all necessary paperwork to ensure legislative compliance.
Lease Renewal Fee
One of the most important roles of your property manager is to keep it occupied at a fair negotiated market rent. When the current lease on your property is due to expire your property manager should implement a proactive plan that assesses the market conditions at the time and negotiate lease terms to ensure that your property remains tenanted so that you can receive an uninterrupted rental income stream.
Top Perth property managers usually charge is around 1 weeks’ rent plus GST or 1.1 weeks’ rent.
Routine Inspection Fee
Regular and thorough inspections prevent minor issues becoming major problems. Routine inspections monitor the wellbeing of your property, tenant safety and document how the tenant is caring for the property as well as identify any required maintenance.
At HERE Property we carry out the first inspections around 6 weeks after a tenant takes occupancy. This acts as an early check for any issues a tenant may need to be warned of and is then set at three monthly intervals for the term of the tenancy. Further, if frequent inspections aren’t conducted, this can void your Landlord insurance policy.
The Residential Tenancies Act allows a maximum of four routine inspections each year and fees can range from $77 to $99.
Marketing and Online Advertising
The internet is the most successful way to advertise a vacant property. Each advertisement consists of photographs and descriptive information about your property.
Your Property Manager should place your property on all major real estate websites, write an eye-catching advertisement for your property and organise professional photos to maximise your chance of renting the property as fast as possible.
Top agencies should offer additional options such as professional photography, floor plans, feature listings and signboards.
Final Inspection and Outgoing Bond
An inspection is conducted when the tenant vacates the property and is used to finalise the disbursement of the bond based on the outcome of the inspection. This inspection is carried out against the ingoing condition report and is required to decide whether any damages or cleaning need to be charged from the tenants’ bond.
During this comprehensive inspection, the property manager will carefully compare the state of the property to the original Property Condition Report, noting wear and tear, maintenance items, any damage and items requiring cleaning.
Property Condition Report
The Property Condition Report comprehensively details the condition of your property at the commencement of each tenancy.
This is an important document that acts as the basis for bond disposal at the end of the tenancy. In cases where there are disputes, this document acts as the most reliable piece of evidence submissible in possible court proceedngs. Because it is a legally required document it should be provided to the tenant in a prescribed format within 7 days of commencement of tenancy.
Pricing ranges from $250 to $495 and can vary based on the size of your property, gardens and level of furnishings included. At HERE we add more details than required by legislation, as well as taking many photographs that can act as evidence.
A monthly administration fee is charged to cover ongoing administration costs such as phone calls, SMS, photocopying, postage and facsimiles with the owner, tenant and maintenance contractors.
Annual Tax Statement
An end of financial year tax statement that summarises all income and expenditure.
There are other fees or costs that may come up during the course of management when certain incidents arise, or you request these additional items. It’s important to check if these are covered or add to your existing fees.
1. signboards, virtual tours, professional photography and upgraded feature listings when leasing;
2. database and credit checks when processing applications;
3. higher management fees and an inventory report on furnished properties;
4. title searches;
5. court fees; and
6. insurance claims.
Why It’s Important To Research Perth Property Management Fees
When you are searching for the right Perth property management agency to partner with, you need to have a solid understanding of what fees will be involved. Not all companies are structured the same, so these guidelines may present themselves in other ways like flat-rate services.
Make sure you do your research and understand which property services are covered in your contract and if the property management agency uses highly qualified repairmen and agents to handle your property. You don’t want to be overpaying for bad work and careless managers who let your property fall apart.
All things considered, the best Perth property management firm to hire is the one that gives you the highest and best net return and keeps your investment in top shape. Saving a few dollars may look attractive at the outset, but if it should cost you vacancy or repair, then it’s never worthwhile.