Caveats of Using a Property Manager

A property manager is commonly covered tenant placement, ongoing management, or both. Tenant placement is generally a onetime fee that is different from 1/3 to some full month's rent. Ongoing management is paid on a monthly basis and is normally 5-10% of the rent collected. However, sometimes you can find hidden fees or other junk fees the manager may charge.
Making profits from repairs
Property management companies may have their very own in-house repair and maintenance division or a sister company. Their main business probably won't are derived from managing properties, but from making repairs. They can charge outrageous high hourly rates on repair and maintenance. They can also mark up materials without providing you other available choices to choose from.
Often times they could not enable you to use another contractor. Even worse, they find unnecessary circumstances to repair or replace to produce a huge profit at your expense. Be sure to negotiate these types of services and make sure these are about the property management agreement. If not, pass this provider up and appearance elsewhere.
Property Investment and Property Management  during property vacancy
There are property managers that won't receives a commission unless the house is rented. It offers them incentive to get your home rented immediately. Some companies charge a fee even if the exact property is vacant. Some charge the identical rate as when the home is rented, although some charge significantly lower rates.
On the surface of that, they ask you for a fee for locating a tenant. Even if the home manager claims no charge during vacancy, there might nevertheless be a catch. A new tenant of your friend of mine moved in on October 1st and also the house was vacant in September. However, his property manager still charged him full commission for September. The reason he gave was since the lease was signed in September.
Late fee policy
Some property managers collect the complete late fee or fee for non-sufficient funds. They argue collecting late payments requires work. It is true to some degree; nonetheless it does not sound right to allow them to profit from it. This is true particularly when those fees are set at the pretty large quantities within the lease agreement.
You might wonder if your manager is attempting to make a simple make money from collecting such fees. In addition, they may be the ones who recruited the tenant within the first place! Splitting the fees between owner and property manager, or capping what the manager will keep to your degree in a given year, seems more reasonable and fair.