Rental property management in Jackson can be a full-time job. It can be easy to manage a single home. However, as your portfolio expands, so does the workload: tenant phone calls, maintenance requests, rent gathering, and so on. So, how much does a property manager cost in Jackson?
Let’s find out. We will discuss the most common pricing structures, other fees that may appear, as well as the factors that may affect the final price to help you select the right option for your investment.
How Property Managers Charge for Their Services
Property managers typically use one of two pricing models:
- Flat monthly fee
- Percentage of rent collected
Let’s take a closer look at each.
Flat Monthly Fee
This structure means you pay the same amount every month, no matter what. Fees depend on factors like property size, location, and included services.
Pros:
- Predictable expenses: No surprises, making budgeting easier.
- Potential savings: If rent increases, your fee stays the same, boosting your profits.
This setup works well for owners who prefer stability. The downside? Since the property manager doesn’t earn more if your rent goes up, the incentive to maximize rent might not be as strong. But a reputable property manager stays focused on keeping your property in top shape because a well-managed property leads to more business for them in the long run.
Percentage of Rent Collected
Here, the property manager takes a cut of your rental income, usually between 7% and 12%.
For example, if your property rents for $1,500 per month and the manager charges 10%, you’d pay $150 in management fees. If rent goes up to $1,700, their fee increases to $170.
Pros:
- Incentive alignment: The more rent they collect, the more they earn—so they’re motivated to fill vacancies and push for higher rents.
- Scalability: If you have multiple properties, some managers offer lower rates for larger portfolios.
The trade-off? If your rental income drops due to vacancies or late payments, their fee decreases but you’re still missing out on income.
Other Fees to Consider
Beyond the standard monthly fee, property managers may charge for additional services. Here are some common ones:
Setup Fee
A one-time fee for onboarding, typically covering:
- Setting up your account in their system
- Initial property inspections
- Establishing bank accounts for rental income
Maintenance Fees
Most property managers coordinate maintenance, but the costs may not be included in their fee. Some charge extra, while others pass along vendor discounts to you.
Some owners prefer to handle maintenance themselves to save money. But keep in mind property managers often get preferred pricing from vendors, so letting them handle repairs could actually save you money.
Tenant Placement Fee
Finding tenants takes time and resources. Some property managers charge a separate fee to:
- Advertise the property
- Screen applicants
- Prepare lease agreements
This fee is usually either a flat rate or a percentage of the first month’s rent.
Eviction Fees
No one wants to deal with an eviction, but when it happens, it’s a headache. A property manager can handle the process for you, but expect a fee, typically a few hundred dollars plus court costs.
Contract Termination Fees
Breaking up with your property manager? There may be a cost. Most contracts have termination clauses, and unless they’ve violated terms, you might owe a fee to end the agreement early.
What Affects Property Management Pricing?
Several factors influence how much you’ll pay for property management in Jackson:
- Property type: Fees vary for single-family homes, multi-family units, and short-term rentals.
- Property size: Larger properties often mean higher fees.
- Property condition: Older properties tend to need more repairs, which could mean higher costs.
- Location: Higher-rent areas may have higher management fees.
- Services included: More services = higher fees.
- Market trends: Rental market fluctuations can affect pricing structures.
A Crucial Detail: Rent Due vs. Rent Collected
One small contract detail makes a big difference. Does your property manager charge based on rent due or rent collected?
- Rent collected: You pay based on actual money received.
- Rent due: You pay based on the rent charged, even if the tenant hasn’t paid.
You want a “rent collected” agreement this ensures the manager is motivated to collect rent on time and keep units occupied.
Is It Worth It to Hire a Property Manager?
It makes sense to hire a property manager if they can make you keep more of the rent you’re paying them. They relieve you of the time pressure, solve difficult issues, and ensure that your investment runs without a hitch.
If you are having your property management consume your personal time, or if you are losing money due to vacancies, slow rent collection, or expensive repairs, then it may be time to consider bringing in a professional.
A good property manager does not only collect rent but also helps in the realization of maximum return, relief of stress, and even expansion of the portfolio. The right one is worth every cent.
If you are considering hiring a property manager in Jackson, we at Lucroy Residential are ready to hear you out and ensure that your vision comes true. Schedule a call today to discuss what kind of value we can bring to your business and for what cost.
