As someone who owns and perhaps operates income properties, the rental fees you charge tenants and the fees you incur from property managers in Buda should reflect service level and the quality of that service. In other words, you get what you pay for. Tenants who want a high level of landlord service must be willing for that to be reflected in their rent and other fees they pay. Likewise, if you outsource all or some of your landlord responsibilities, then you should be willing to pay for it. Paying less than you ought results in a lower level of service and perhaps greater costs and less income over the long-term.

Charging Application Fees

One area where inexperienced landlords often don’t charge fees but should is the application process. In fact, nearly any property management company in Buda property management responsible for such applications will require such fees from the client and recommend that they pass that cost onto the prospective tenant. Think of a thorough vetting process not as a cost of doing business but as a service that ensures that that property is held to a certain high standard. Application fees are also an excellent way to reduce the number of potentially bad renters you’ll encounter as you seek to fill a vacancy. These fees also help cover the costs of filling vacancies and can offset the total cost of renting for the renter.

Fees Must Cover Ownership Expenses

How much should you charge a tenant and when? This is a complex question with complex answers and an area where many landlords go about it the wrong way. Many property owners will determine rent and other fees based solely on their monthly mortgage and what they think they can get away with. There can be numerous hidden costs as a landlord as well, and one of the great arguments for hiring property managers in Buda to represent you is that they can reveal these hidden liabilities. In addition, they can help you determine the true value of the property within the context of the market. Keep in mind that the rental fees you charge must cover not just your mortgage but:
• Taxes
• Insurance costs
• Administrative charges
• Legal fees
• Maintenance costs

Fees Must Reflect the Depth and Quality of Service

Renters will have certain expectations of you based on the rental fees they pay, where they live and the promises you made. If you employ a property management firm, you, in turn, will have expectations of them based on what you pay them. In fact, clients of property managers should have the expectation that the services provided will cover and perhaps exceed the cost of that service. When you factor in maintenance costs, you must consider not just the maintenance itself but how that service must be delivered. When it comes to a high-value rental, for instance, the tenant may understandably demand that a repair is performed within hours even if that means a late night on a Sunday.

Supporting Fees via the Quality and Level of Service

As an income property owner, you should strive to earn as much as the current real estate market will allow. These properties are investments after all. However, you must also provide an equal level of service to tenants not only because that’s the right thing to do but because it will help build your brand. Providing the high level of service that many rentals warrant can be quite the challenge for the individual or even a small business. You probably will have to rely on other businesses to fulfill the role. No matter how you choose to tackle this challenge, be mindful that the level of service should reflect the fees charged, and you should be able to justify those fees to a client based on the services provided.

Late Rent Fees

Earlier, we discussed application fees and how that’s a valid fee that many landlords should charge but do not. Another example of fees that inexperienced landlords should charge but don’t are late fees. Remember, you’re not just providing a residence but a service. There are numerous costs to you for maintaining that service, and you have the right to be paid on time. When you don’t receive that money on time, then you have some right to lost interest and other costs incurred. Take advantage of this right, but don’t just pick a fee based on what feels right. You have state and local laws to consider, and these late fees should reflect actual losses rather than serve as a means to punish tenants.

Professional Property Management Makes Great Sense

Professional property management services help deliver the level and quality of service that maximize the value of a property. They help a property owner meet their responsibilities but also work to improve the status quo or at least should. As with all things in life, you get what you pay for. You shouldn’t overpay for such services, but there are many property managers who deliver a very basic level of service or what you might consider just good enough. The best firms go well beyond this in order to reduce your expenses and risk, increase your bottom line and so forth. That is a level of service worth paying for and an investment in your properties that will pay dividends over time.