Giving a house or part of the house for rent is one of the common practices followed by humanity for years. It can also be said that giving up a rental property is the source of additional income when staying at home. By going through this practice, many people extend the portion of their existing house or build additional houses with rent forgiveness. All these activities at first seem quite simple to them and they proudly display their properties compared to the known ones, but their happiness is nothing less than a bubble that vanishes in a few seconds.
By disappearing I do not mean that your property fades or collapses, I mean the problems you face before and after giving up a rental property destroys your dreams of making a substantial profit from the property in a short period of time. This is mainly due to the complications associated with handover of rental property, because handover of rental property does not stagnate at allowing someone to stay at your home and pay you the requested rent. There are many formalities that you are expected to follow as a landlord, with this you also have a lot of responsibilities towards your tenants that you are expected to fulfill upon request.
Anyway, all these problems can be done only by the person who has built an additional property only for the purpose of giving it for rent, because usually if someone has given a part of their house for rent, they can easily take care of the related matters with the lease. . But, if a person has developed any additional property, then there is a chance that they will definitely realize that managing a rent-paying property is everyone’s cup of coffee.
So how to get rid of this problem is a matter of concern among these homeowners or homeowners. Interestingly, in order to solve the problems of these owners, today there are several property management companies that deal with all matters related to the delivery of rental properties. These groups or firms are mainly constituted by the group of experts with knowledge in the treatment of issues related to the property transferred for rent.
Types of property management fees: Although the property management fees refer to the amount charged for the care of the property given for rent, but depending on your requirements, the property management companies collect the fees in different formats. Some of them are mentioned below:
1. Monthly administration fees: It is a term that is understood by itself and refers to the payment that is made to the property management company each month for the services provided by it. This payment is made for the various services offered by the group, which include the receipt of the rent from the tenants, the periodic inspection of the property, the maintenance of the property, the pursuit of complaints received from the tenants at odd hours, etc. . The amount of this fee varies mainly from 7% to 10% of the monthly rent received from the tenants.
2. Leasing Fees – This fee refers to the investment made to advertise the property, show the property to your prospective tenants, screen tenants and check their previous credit score, get all legal documents prepared accordingly, and various other tasks . This is generally a one-time fee and varies primarily from 75% to 100% of the first month’s rent.
3. Maintenance fee: It refers mainly to the investment made by the company to maintain the status of its property. As a general practice, this type of fee is charged primarily on terms and conditions determined between the property management company and the owner. If the landlord assumes the responsibility of taking care of the maintenance of the property, no fee is paid to the group, but in case the responsibility is transferred on the shoulders to the group. Then, depending on the terms, conditions and maintenance fee, the group is paid.
4. Late payment fee: If the tenant is unable to pay the rent by the specified date, in that scenario, the management company could choose to collect the full portion of the rent or a certain percentage of the rent based on mutually agreed terms.
5. Eviction Fee: There may be circumstances where the landlord wants their home vacated before the lease ends. In that scenario, the management company can help you get the tenants evicted from the house, either by mutual agreement or through court. Depending on efforts and time, the property management company may charge the necessary fees for the property.