Peninsular Property

How Much Does Property Management Cost?

As awareness of investing and money management grows, you may find yourself wanting to invest in property or grow your investment portfolio further. However, with property investments come big roles and responsibilities that must be carefully considered.

These duties can be daunting for new investors, and tiring for those with a large property portfolio, and a great way to reduce the time, energy and real estate knowledge required by you is to hire a property manager.

Property managers simplify this process by handling these tasks on your behalf. This means that you’ll have much more time to focus on other important tasks and your daily life. Sounds good, right?

But you’re probably wondering how much property management costs, what it involves and the pros and cons of this service. So, keep reading to find out more.

 

The Role of a Property Management

The value of a property management company can be incremental to the development of your property investment for several reasons. As a landlord, this helpful service can give you a lot of time and energy to focus on other areas of growth and daily activities. Here’s why:

  • Property maintenance
  • Collecting rent
  • Tenant screening and management
  • Maintaining tenant relations
  • Property marketing and advertising
  • Ensuring legal compliance
  • Financial management
  • Risk mitigation and management
  • Accurate record-keeping and administrative tasks
  • Lease and lease renewal management
  • Property inspections and reports

Who Needs Property Management?

Determining whether hiring a property manager is worth it is a personal choice, depending on your individual circumstances. It’s a common mistake that only experienced investors require a property manager. There are several people who could benefit from the assistance of a property management company, such as:

  • If you’re a landlord with multiple property investments
  • If you have a busy life schedule with limited time and emotional availability
  • If you lack experience in the real estate industry and associated laws
  • If you’re focusing on acquiring real estate and would prefer a hands-off approach
  • If you’re a landlord seeking to optimise your rental income
  • If you’re looking to increase your property value without knowledge

 

Pros and Cons of a Property Manager

Seeking professional expertise from a property manager has a mixture of pros and cons. Understanding these advantages and disadvantages is essential to determine if it would suit your needs.

Pros Cons
Long-term cost savings Communication challenges which can be mitigated with open communication
Time-saving and reduced emotional stress Reduced control over day-to-day operations
Efficient repairs and maintenance Management fees
Lower tenant turnover due to satisfaction Potential conflict of interests, highlighting the importance of property manager research
Legal compliance and risk mitigation
 

How Much Does Property Management Cost?

Typically, the costs for a property manager in the UK can range between 8-15% of your rental rate. However, it is wise to note that this can differ for varying reasons, and there may also be additional costs that you may have to factor in.

 

Property Management Fees Explained

For a fully managed service, where the letting agent handles everything, fees are usually between 10-15% of the monthly rental income. Some companies may charge a flat monthly fee instead of a percentage. 

The specific costs depend on several factors, including the level of service provided (tenant-find only, rent collection, or full management), location, rental price, and whether it’s a national or local agency.

National agencies are usually slightly more than local agencies and agencies often charge extra for tenant referencing, preparing tenancy agreements, renewing tenancies, and arranging maintenance and repairs. This fee can be around 10-12% of the invoice costs.

When investing in property, you must ensure you look at the full range of services provided and any additional fees to understand which has the best value for your needs.

Tip: If you’re looking to save costs, self-management of your property can help, while hiring a property manager can help you save time and energy.

Are There Any Extra Property Fees That I Should Know?

Yes, when managing a rental property, several additional fees may come up which must be taken into account when budgeting for these services.

These additional property costs include setup fees for establishing management services, monthly management fees for ongoing oversight, maintenance fees for property upkeep, new tenant/guest placement fees, eviction fees and early termination fees.

Of course, not all of these may apply to you and your circumstances, but they are worth knowing so that you can stay informed about any potential extra outgoings. This will allow you to financially prepare and feel more confident in your investment.

 

Grow Your Investments With Peninsular Property

Expanding your investment portfolio is a great way to build wealth and while property is a popular way of doing so, it can be time-consuming and require you to expand your property knowledge to ensure compliance and learn the best management techniques.

At Peninsular Property, we understand that this isn’t ideal for every investor, especially if you have multiple properties in your investment portfolio. Luckily, property management is available to take this worry off your shoulders.

If you’re new to property investing or are an experienced property owner seeking the right investment opportunity, put your trust in us. Our knowledgeable team has been helping keen investors like yourself for over 30 years and is excited to help you get one step closer to your investment goals.

 

Property Management FAQs

If you’re looking to free up time and preserve your energy, utilising property management services can definitely help and will be worth the property management costs. This way, you can focus on other tasks, whether it be daily life, other professions, or looking for ways to build your wealth even more.

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