You got a great deal on an equally great Aurora property. It is just perfect for the rental market.
A little work and presto, it’s ready to be anointed as your next profitable investment property.
But, there’s a problem.
This is your first investment property near Denver, an area that is a little far from your base of operations. And the town is not familiar.
This makes the kind of quality maintenance you expect a challenge and marketing the property will be issue since you are not sure where to get the word out to prospective renters.
A property manager, like Aurora’s Property Alliance, is a good alternative to managing the property on your own. They know the area, have relationships with local maintenance professionals, and have a marketing system in place to reach the right renters.
But how much do they cost?
Aurora Property Management Costs
Hiring a property manager, whether it’s with Property Alliance or another company, will not cost an arm and a leg. Several companies in the Aurora area are looking to get your business, which means there is plenty of competition to keep costs down.
Because of this reality, you can expect to see any price include two standard fees:
Property Management Fee:
An occupied unit generates income, the lifeblood of an investment property owner and any company hired to care of their property. Property managers will take a cut of the rent between 3 percent and 15 percent. However the standard is about 8 percent, which happens to be the contractual rate applied by Aurora-based Property Alliance.
This cost covers the cost getting the property on the market. It pays for things like getting the property listed in various publications, showing the property, setting up an account – the general activities needed to get the Aurora investment property rented. The price of this fee can be from $250 to $500, depending on the efforts of the property manager to get things rolling. Follow this link to explore Property Alliance fees.
Fees that You Should Question
It is always a good idea to take a look at your property management contract. There may be some fees hiding in the text that will have you shaking your head in anger, disbelief, or… well you can choose the emotion.
These hidden fees can also make the difference between a great property manager and a so-so property manager.
Here is a look at fees that should make property owners to take a second look:
Lease Renewal Fee:
This is the cost for getting a tenant to renew their lease on an annual basis. A property manager should explain why this is in place. Are they just making up for a smaller management fee?
Maintenance Mark-up Fee:
These fees are added to the bill of maintenance work done on your Aurora investment property. They should make you wince.
“For Rent” Sign Fee:
Some property managers charge $25 a month to have a “for rent” sign on your property. Uggh!
Preventative Maintenance Fee:
This can be about $20 a month and covers items like filters for air conditioners and similar maintenance items. But does the property manager actually take care of these maintenance issues? Are you being charged $20 a month for nothing?
Property management companies may say these fees are necessary in order to offer a low rates elsewhere. For instance, a company may advertise a lower rate to administer the property but the contract shows they make up the costs with these hidden fees.
So, read the contract before signing the dotted line.
For the record, a property management fee and a one-time leasing fee are the only items you’ll find in a Property Alliance contract. Contact us today and see how a quality property manager can generate profit on you Denver-area investment property.