Apr 23

Understanding Property Management Costs In Phoenix, AZ

property management Phoenix

If you cannot manage a Phoenix, AZ rental property due to work/study/parenting commitments or because you reside out-of-state, you can assign the task to a property management company. Of course, you will have to pay a fee for this service. Some of the common property management costs in Phoenix AZ include:

Start-up/lease-up/initial finding fee

Though not standard across the board, you will come across property management companies that require clients to pony up start-up fees. In general, lease-up fees vary widely ranging from as little as 4% to more than 10% of your property’s total lease amount. In addition, you would have to pay the same fee whenever your property management firm signs a new lease. Companies that do not charge this fee usually inform consumers when marketing their services.

Monthly management fee

This fee is a small percentage of your property’s monthly gross rent revenue. According to figures published on city-data.com, this fee ranges from 8-10% in Phoenix. The good news is monthly management fees remain more or less within this range across all US states. It is worth noting that you can cancel a property management contract at any time if unsatisfied with services offered. However, you must provide a written cancellation notice 30-days prior to ending the working relationship with your current property manager.

Tenant lease renewal fee

After a tenant’s lease period expires and he/she opts for renewal, you will have to pay your property manager a pre-agreed fee. Unlike the fees described above, companies that offer property management services usually quote this fee in US dollars ranging from $100 to $180 or more. For instance, if a tenant signs a one-year lease, a property manager will expect $100-$180 after renewing the lease at the end of 12 months.

Marketing/advertising fee

Some property managers charge their clients a marketing fee to cover the cost of video production and buying ad-space online to market a property whenever it is vacant. Since marketing expenses depend on numerous variables, this fee can range from less than $100 to hundreds of dollars.

Conclusion

Property owners planning to hire Phoenix, AZ property management firms should evaluate services offered as well as fees payable annually or monthly. These include start-up/lease-up, marketing/advertising, monthly management, and tenant lease renewal fees.

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