The question we are asking today is: Can you get free property management? The answer is yes and no. Professional property management actually can be free to you as the landlord, but it won’t be free to your tenant.
Commercial Business Model
Think about commercial businesses. To have office space, we pay rent here at Progressive Property Management. We pay a base fee per square foot of space that we use, and then we also pay a CAM fee, which covers maintenance and upkeep of the common areas. That means when you combine all of the money we pay, we pay the property management fee for this building.
Having Tenants Pay the Property Management Fee
There is no reason why you as an owner can’t have your tenant pay our property management fee. We have a formula for doing that. First, we disclose to the tenant that they will pay a base rent of $2,000, plus a $100 management fee every month. Then, we collect the $2,100 from the tenant, and we keep the $100 while forwarding you the $2,000. This works especially well for people who have been managing their own properties and are perhaps not charging a market rent for their home. This is fairly common. We’ll have an owner call and tell us that they collect $2,000 in rent and we’ll tell them that the market rent is actually $2,300. So we’ll raise rent on the tenant to $2,200. The owner will get an increase of $100 every month, even after our fee is paid.
So yes, there is free property management when we can get you the same amount of rent or more money in rent than you were getting before.
If you’d like to talk more about how we can help you without increasing your out of pocket costs, please contact us at Progressive Property Management.