In Kenya, the top property management companies charge property management fees of between 5% to 10% of the gross rent. For example, if a property owner collects a rental income of kshs 250,000 per month, the firm gets 12,500 kshs to 25,000 kshs in management fees (see table below for more examples).
In addition to the 5-10% management fee, most property managers charge extra fees which can include maintenance fees, inspection fees, leasing fees and miscellaneous fees such as cleaning and garbage collection charges. While most property managers in Kenya charge a 5-10% management fee, It is also not uncommon for some property managers to charge a fixed monthly fee instead of the 5-10% fee.
Having now known the cost of hiring a property manager, should you hire a property manager?
We will cover the following topics to help you answer this question:
A good property manager will not only save you time but will also help you lower maintenance and repair costs, screen tenants, ensure proper record-keeping, and fewer legal cases.
a. Save Time
Managing a rental property can be time-consuming especially for property owners with many rental properties. Rent collection, handling tenant issues, keeping tenant records, screening tenants, and maintaining property repairs on time can be a challenge to many landlords. These tasks take time and hiring a property manager to perform these tasks can help you save time.
b. Less Vacant Units
Good property managers help property owners fill vacant units. They do this by setting competitive rent prices and advertising vacant units. Filling vacancies helps you get more revenue from your property.
c. Lower Maintenance and Repair Costs
The best rental management companies have professional maintenance staff (electricians, mechanics, contractors). They take care of property maintenance and repairs on time and carry out regular maintenance checks and inspections. This not only helps lower maintenance costs but also lead to happier tenants.
d. High-Quality Tenants
Qualified property managers screen tenant applications for high-quality tenants. With high-quality tenants, you will receive rent on time, reduce property damage, and have longer lease contracts with tenants.
e. Collection of Rents on Time
A good property manager follows up with renters who have not paid their rent on time. They ensure tenants pay on time because they only get paid a percentage of the rent collected. They also enforce late payment fees to encourage tenants to pay rent on time.
f. Fewer Legal Issues
As a landlord, a bad renter can give you legal problems. A good property manager will do tenant screening and will implement policies that do not break the law. This can save you time and money from having to handle legal issues.
Having a property manager sounds good but can be stressful and challenging to property owners. Some of the challenges property owners face include
a. High maintenance costs - Property managers usually charge 5% to 10% of the rent collected. Additionally, they charge extra fees such as maintenance fees and administrative fees. These fees can be too high for some landlords.
b. Poor reporting and communication - Some property managers do not properly communicate and send accurate reports on time. This can lead to late payments, extra paperwork, financial loss, and lawsuits.
c. Dishonest - Not all property managers are honest and trustworthy. Some property managers collect extra fees from tenants without informing landlords. Such dishonest activities can continue for a long time especially if the landlord doesn’t regularly inspect their property. This can lead to not only a loss of revenue but also unhappy tenants.
d. Irregular property inspections - Even after paying inspection fees, some property managers fail to regularly inspect a property. This can lead to deterioration of your property.
An affordable alternative to hiring a property manager is by using a property management software. A property management software cannot replace all the duties of a property manager. However, it can help you more efficiently and effectively manage your property while doing less work.
A good property management software, such as Bomahut (www.bomahut.com), can help you:
a. Save time by automating repetitive tasks such as reminding tenants to pay, recording payments and sending receipts.
b. Automatically record and reconcile tenant payments by integrating with popular payment platforms such as MPESA and Banks (KCB, Equity). You would no longer have to deal with reconciling tenant payments.
c. Automatic SMS rent reminders to remind tenants to pay rent on time and easily follow up with tenants with account balances.
d. Keep updated tenant records to assist you in staying organized.
e. Reduce paperwork by sending SMS invoices and receipts.
f. Easily communicate with tenants using Email and SMS.
Bomahut property management software offers all these features at the following prices:
For more information please visit https://www.bomahut.com/.
Book a demo with us to learn how Bomahut can help you improve rent collection and save time on property management tasks.
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