Property Management Fees that San Antonio Real Estate Investors Should Expect

Real estate investors that have never used property management companies may have one big question: how much does it cost? Investors do not want to feel like they are getting nickeled and dimed for everything. They want to know what property management fees San Antonio property owners can expect to pay.

Below is some insight into how property management companies in San Antonio set their fees, and what this means for you as a real estate investor.

 

Setup Fee

Most property management companies in San Antonio charge a one-time “setup” fee. This charge is usually small and used to cover the cost of setting up your account with a property management company. The setup fee may also include initial inspections to assess the current condition of the property.

 

Management Fee

The management fee is the primary fee that you will pay every month. Most property management companies in San Antonio, Texas charge either a monthly flat rate or a percentage of the total collected rent. Rents can vary by market, but in general, property management companies charge about 10% of the property’s monthly rent. Pyramis Company offers a straight 9% management fee per month, and this rate can be lower for investor clients with more properties.

Make sure your property management agreement states that you will be paying out of "rent collected," not "rent due" or "scheduled rent." Making sure the language states "rent collected" ensures that you will only ever pay a management fee when someone is renting the property. If you are not making any money, then the management company isn't either, which is an excellent way to keep everyone incentivized to work in each other's interests.

Some companies offer asset property management in San Antonio, TX in which a company handles all of your rental properties and supervises the preparation of financial documents for your properties. Asset property managers are useful if you need someone to handle the financial documentation of your real estate investments.

 

Maintenance Fees

Every property will require periodic maintenance, so you will likely be paying maintenance fees. According to experts, the annual maintenance cost for a unit is around 1.5 times the monthly rental rate. For example, if your condo rents for $1,000 a month, you should be prepared to spend about $1,500 in repairs over a one-year lease. Pyramis Company works closely with their clients to make sure they know exactly what maintenance fees they are paying for.

 

Leasing/Lease Renewal Fees

Generally, property management companies charge a leasing fee when a new tenant or when the lease is renewed for an existing tenant. This fee is usually equivalent to some percentage of a single month’s rent, generally between 25%-75%. These fees often cover the cost of advertising and marketing the property. At Pyramis Company, the leasing fee is 50% of the monthly rental rate and a flat $200 per lease renewal.

For many San Antonio real estate investors, hiring a property management company is an obvious choice. Property management companies like Pyramis Company take care of the day-to-day operations of rental properties so property owners can instead focus on other investments.

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