How much should property managers charge? Being a property manager is hard work. Flipping a property acquisition into a worthwhile investment is a skill most of us only dream of having. Setting a price to such an important skill set can be difficult.
How Much Should Property Managers Charge? It Depends on Your Expertise
When calculating your worth as a professional there are a few things to consider. First, your individual level of expertise should be quantified. All relevant aspects should be considered. These aspects should include schooling, degrees, certifications, work experience, and personal achievements. When pitching yourself to property owners looking for a manager, your record should speak for itself. You need to have data on how growth and increased profits were achieved under your management, and to what degree could that growth be measured.
Say you aren’t as experienced as you want to be. That’s ok for now. You’ve got to start somewhere right? The best time to establish your reputation as a capable property manager is now. The first thing to do when you start managing a new property is to determine the state of the property before you make any changes. That way you have a clear vantage point to monitor progression or regression.
How You Are Paid
Before asking how much should property managers charge for their services, property managers may be at the mercy of the property owners. They may remain in this position until they prove themselves worthy of setting their own rates. As a possible payment method property owner might insist on is a commission based payment system. Probably not a pure commission, but enough to encourage the property manager to run an efficient operation.Property management for apartment complexes tends to bring its own challenges. Find more on the challenges and the solutions to apartment management here.
Depending on the type of property being managed, the calculation of a commission based payment could carry greatly. For example, in a residential property, a property manager might be given a commission for every vacancy filled. For a commercial property, aspects such as maintenance and keeping costs down would be more important. In that instance, savings could be passed on to the manager as a bonus.
Say you are as experienced as you want to be and have an established track record of being an excellent property manager. If you are the miracle worker your property owner is looking for, you very well may be inclined to set your own rates on your own terms.
Even though you might be calling more of the shots, there are still some things to consider. You may be a great property manager, but it’s unlikely that you accomplish everything completely on your own. If you bring along your own team to assist you with property management their compensation is something to be considered when determining how much you will charge.
The size and complexity of the property being managed will also largely play into how much property managers should charge. Apartments and hotels require constant maintenance and oversight. Imaginably these properties are quite demanding to manage for even the most skilled property manager, so the rates charged should reflect the inherent effort that will be involved.
Ultimately how much property managers should charge will vary from manager to manager. Managers should know how much their skills are worth and be able to convey that worth to property owners. Property managers rate of pay should directly reflect their performance while managing properties. Property owners are looking to their managers to make sure their investments have been worthwhile and eventually begin to turn a profit. When a property manager has accomplished that, then I feel they can truly begin to set their own rates and answer the question how much should property managers charge.