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Property Management Fees Los Angeles: Is a la Carte Right for You?

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Los Angeles property management groupProperty Management Fees in Los Angeles

Rental property management fees should not be veiled in mystery, and just because a price is
a low upfront does not mean you’re ultimately getting a great deal. From negotiating your rate to
considering the unique services you’ll need on your property or properties, analyzing cost is a
great way to get a feel for how your property will (or won’t!) be cared for by the company you
hire. Just remember, sometimes a low-cost upfront means hidden ones down the line.

While some property management services in Los Angeles charge an all-inclusive monthly fee as a percentage of the rent you
charge tenants, typical property management fees can also apply to a la carte service items.
Every aspect of service may have a fee attached to it including maintaining and doing repairs on
your property, finding and letting go of tenants, dealing with legal aspects like leases and
evictions, as well as setting up or cancel your account with them.

How much do property managers charge?

Property management company fees should be made transparent before you open an account
with them. To find out how much you’ll be charged, you can ask your leasing agent about the
fee items below. Ask if each item is included in a monthly charge or flat fee or if you can pick
and choose which services you want to include like items on your deli sandwich.

Another way to investigate a company before settling down is by reading reviews. Find frank
reviews where business profiles are listed on Yelp or Google. You might even send a message
to a past customer to get an updated take on their quality of service. Keep reading to learn more
about exactly what average property management fees are and what to discuss with your
prospective agents.

What fees do property managers charge for?

There are a variety of fees that may be added to each monthly bill you pay. Depending on the
pricing structure you sign up for, the service fees may be included in a monthly charge, or you
may pay for them as they become necessary. Here is a list of the most common fees you will
encounter:

Management Fee: Flat Fee Vs. Percentage of Rent

There is a debate about which is best, the flat fee or monthly percentage of rent. Flat fees are
generally around ninety to one-hundred dollars depending on what’s included. Opting for a flat
fee means that even when you raise your rent, your commercial or residential property
management fees remain the same. Because of this, over time you’ll make more of a profit.
Additionally, this flat fee covers all services, so no hidden fee will crop up on you seemingly out
of nowhere.

If you are paying a percentage of the rent, it can get to around six to twelve percent of what tenants
pay. Other costs and fees are usually tacked onto this monthly fee. On the other hand, paying a
percentage of your rent and choosing the services you need a la carte can lower costs in the
long run and be just what you need for your particular location.

Maintenance Fee

When it comes to property management costs, this service is one of the most important in terms
of maintaining value on your real estate. It covers routine repairs as well as unexpected and
emergency issues like when a tree falls on your roof.

A company may have you create a reserve repair fund where a sum of the landlord’s money is
set aside to pay for repairs as they are needed. This account is always kept at a certain amount
so there’s enough to pay vendors coming to fix that broken door at three a.m. or whatever the
issue may be.

Occasionally this fee won’t include the additional time your agent must spend personally interacting
with vendors or being on-site to oversee work done. Protect yourself and make sure you ask
exactly what’s covered.

Late Fees

As for the cost of property management, make sure to ask about the late fee. Before you sign
up, find out whether or not they charge one. There’s nothing worse than learning after the fact
that you owe a big sum for being even just a few hours late on your monthly payment. Also, if
tenants are charged a late fee on their rent, managers may keep this amount for themselves.

best property management in Los AngelesRent Fees

Many leasing agents will deal with all aspects of rent money on your behalf, and that’s why
another important fee item on the property management price list is collecting, adjusting, and
setting rent. Setting rent price is a big job that falls under the umbrella of a leasing agent and a
nuanced one, too. For example, different rent price points attract more or fewer prospective
tenants as well as different kinds of personalities.

Rent collection is another service offered to you for which there is a fee. Your company may
enforce a strict policy that encourages tenants to pay on time and means you are never short on
cash when it comes to paying for your investment.

Every year municipal law dictates by what percentage you are allowed to increase the amount
of rent you charge. If you want this handled for you without having to do the research yourself
and personally explain the change to tenants, it’s beneficial to ensure your property overseers
will communicate this for you.

Handling Complaints and Emergencies

Buying this additional service if it’s not included in a monthly flat fee could be right for you. Think
about your property and the tenants who live there. Are they the type who will get into conflict
with one another because of noise or pet concerns? Is your property well structured or a bit
flimsy and liable to need emergency repairs? The average cost of property management each
month can occasionally leave out fees tacked on for when managers must go on location to
handle tenant complaints or unexpected emergencies.

Tenant Placement Fee

If you want to know, how much does property management costs, ask yourself if you need your
company to help you find tenants for your vacant properties. Finding the right person for your
property involves knowledge of advertising and marketing. You will want a savvy leasing agent
who can take high-quality, professional photography and even drone videography to make it
look spectacular and attract visitors. Furthermore, you will want them to have developed
thorough applicant screening services so you only have to interview the highest tier.

Eviction Fee

Having to confront tenants who don’t pay rent is never fun. This is another aspect of tenant
relations that can be handled for you when you pay an extra fee. A 3-day notice is hand-delivered, and some companies will even handle the more complex legal implications for you.

Vacancy Fee

It can be disappointing to learn that you can even be charged a fee when you aren’t making
money on your unit. This is because units must still be maintained when you are gone. For
example, you wouldn’t want people moving in and graffiti your real estate or for a fire hazard
to accrue. You will also need to continue routine repairs and get it ready to show to the next
tenants.

Set-up and Early Termination Fees

In some ways, property managers charge like gyms. Just like gyms, sometimes you will be
charged a fee for setting up your account. At most you would be charged $500. Some of this
goes towards surveying your properties to make a detailed proposal about what kind of services
they’ll offer you. At the same time, if you decide you want to switch management companies,
you may learn about an early termination fee in your contract. When signing up with a new
company, this is a good item to get clear on.

Leasing Fee

Another legal service your property management agent can provide for you for a fee is set- up your lease contracts
with tenants. Because a lease protects landlords, you really want to work with someone you
trust to make sure all the safeguards are in place such as collecting the correct amount of
security deposit.

Summary

If you were wondering, what do property management fees cover, these are the main price
items you will encounter. However, you can always ask for a more detailed list if you get the
feeling that the company is hiding something. Additionally, you may want to consider working
with a small company over a large one with a high volume of clients. When companies are
spread thin, the service they provide will be poorer quality. By the same token, companies who
charge very low amounts may burden you with shocking charges in the future. Your best bet is
to get educated: read reviews, consider what services you need performed at your location, and
see if an a la carte or all-inclusive system is best for you. Good luck

If you have any more questions about property management in Los Angeles, contact Luis Pezzini at 818-445-9557, one of the most experienced LA property managers and get answers and help your investment needs.

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