Management Company excessive side fees
Hi everyone, I moved overseas and hired a big name management co ( Two letters and one number in their name) in Riverside to handle the property. They take 10% which is fine. But it is the excessive side fees that I can never get full monthly rent. They had a tub faucet repair and the plumber charged $65, fine, then everytime a repair is done- the management company charges me $487 to supervise the work of a reputable A+ company! So everytime the tennant asks for some small repair, I pay for that, and they charge these excessive oversight fees. I have yet to get the full rent! I should be clearing $1800 after they take their share. I am getting deposits of like $20, one month, $39 next month and now $1400 this month. They also charge the tennant $49 mo for a pet fee (because they said if I allowed pets I would get a renter faster (I did not want pets), but they keep that money too! Can these contracts be broken? I chose them because they were a big name that has been around for a while, but this doesn't seem fair. I don't even clear enough for the mortgage of $1200 most months, and the home was already remodled before I left.
#2 All Forums Contributor
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- Virginia
@Ingrid Abrams
This will all depend on the contract. Read the contract or have an attorney review the contract to let them know if you are able to cancel. Most are 12 months with a termination fee
As Chris mentioned, it's important to read the contract which should outline all fees the management company can charge for their services. At the end of the day PM services are generally regarded as a loss leader for vertically integrated real estate companies that choose to self perform this task. Therefore, for a 3rd party to offer these services they generally have to find ways to provide affiliate services or generate additional revenues. Layer on the fact you seem to have a small account which suggests you are not getting the same pricing as a client who has many units under one roof where there are greater efficiencies. This is how the PM business tends to work.
#2 General Landlording & Rental Properties Contributor
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#2 General Landlording & Rental Properties Contributor
Read the contract and see what the termination fee is. Charging that much to oversee the work seems excessive.
Wow, that seems absolutely crazy. But, I guess every market is different. Check the contract. Something still seems off.
We charge oversight fees if the project is outside the scope of normal wear and tear. A faucet repair is about 5-10min of our time. There is no reason to charge an owner for sending a work order to a vendor.
Honestly, this is why good property managment companies can do so well, there is alot of stuff like this going on in the market.
The core of our business philosophy looks at owners as business partners and tenants as customers. If I were you, I'd look for a company that has a similar view.