If you own or are thinking of purchasing a rental property, you need to understand and consider the different fees and charges you will potentially be charged by different property managers. Each property manager’s fee schedule is usually slightly different however you will find the most common fee’s charged by Brisbane property management companies below.
Letting Fee: 1 – 2 Weeks Rent
The letting fee is a charge that your property management agency will bill you to cover the advertising, tenant inspections and signing of the lease.
Lease Renewal Fee: % of 1 Weeks Rent or A Fixed Fee
The lease renewal fee covers the cost of having a new lease signed by the tenant. Most real estate agencies will not charge this fee however there are some that will.
Management Fee: 5% – 9% + GST of Total Monies Collected
The management fee is the main fee that is charged to manage the lease of your property. This fee covers the collection of rent, property repair overseeing costs and any unforeseen circumstance. Take notice of the wording “of total monies collected”. An agent will usually only charge you fees on the money collected. This gives your agent incentive to make sure the rent is paid on time, every time.
Banking & Petties: $4 – $8 per Month
Banking and petty fees are charged to cover the expenses of running an office. Paper statements, office utilities and supplies, etc. Some agencies don’t charge this fee but more do than don’t.
Financial Year Statement: $20 – $50 per Year
For taxation purposes a financial year statement is required for your accountant to calculate your deductions and taxable income from your rental property. As with the banking & petties some agencies don’t charge this fee but more do than don’t.
Major Repairs if over $1000: 3% – 6% of total work costs (If the agent handles the repair)
At times, it’s not uncommon for a landlord to upgrade or repair their rental property. In circumstances where the cost of repairs exceeds $1000 most agencies will charge a major repairs fee of 3% – 6% of the total repairs cost. This charge is there to cover the additional time required to manage a large repair or renovation to the property. Builders will charge anywhere between 10% – 20% to manage any building work so a 3% – 6% charge for overseeing repairs isn’t an unreasonable charge compared to a builder.
Court Attendance (if required): $45 – $95 per Hour
When a tenant has a dispute that can’t be resolved through private mediation, the next stage is taking the matter to QCAT (Queensland Civil Administrative Tribunal). At QCAT, each party will be given an opportunity to present their case to the court and the judge will review the law and hand down the most appropriate sentence. As each case can stretch for an unknown amount of time, your agent who is handling the matter will need to attend court and wait for their case to be called. This can take anywhere between 1 – 8 hours and may even be stretched into the next day. Most real estate agencies charge an hourly rate fee to cover the cost of being present in court.
As you can see from the information above, there is a wide variety of fee’s charged with the management of a property. The important thing to take into consideration is the quality of service you will receive for the fee’s you will be charged. Like any profession there are always those that offer discounted or lower fee’s and usually provide low quality service.
At Loth Estate Agents we run our business differently. There is no fancy office, no expensive coffee machines and our staff are highly skilled. We invest heavily in our staff through mentoring, formal training and education and pride ourselves on our high customer retention and satisfaction levels. Through countless years of experience we have built a business model that allows property owners to receive the highest level of customer service without being charging ridiculous overpriced fee’s for property management.
We are Brisbane’s most professional specialist property management company and we would love to talk to you about how we can assist you. Please call us on (07) 3366 1764 or visit www.loth.com.au to learn more.
*All figures above are estimates only and have been calculated in the Brisbane, Queensland, Australia area.