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Business finance / Property Management Fee Calculator

Property Management Fee Calculator

What a property manager will cost you per year: the monthly fee on rent collected, plus leasing, renewal, flat and repair-markup fees, shown as a share of your rent.
$

Enter a number of at least 0

%

Enter a number from 0 to 50%

Percent of rent collected, from the management agreement.

Enter a number from 0 to 12

Most managers charge the monthly fee only on rent they collect.

%

Enter a number from 0 to 200%

Charged when the manager places a new tenant.

Enter a number from 0 to 12

0.5 means a new tenant every two years.

$

Enter a number of at least 0

Enter a number from 0 to 12

$

Enter a number of at least 0

Technology, admin or inspection fees billed monthly.

$

Enter a number of at least 0

%

Enter a number from 0 to 100%

Some managers add a percent to contractor invoices.

$

Enter a number of at least 0

Property manager cost per year
$2,800.00
12.2%of rent collected
$233.33per month, averaged
$18,700.00you keep after fees and repairs
$0fees $2,800.00
  • Monthly fee
  • Leasing
Rent collected · $2,000.00 × 11.5 months$23,000.00
Monthly management fee · 10.0% of rent collected$2,300.00
Leasing fees · 50% of a month's rent × 0.5$500.00
Renewal fees$0.00
Flat monthly fees$0.00
Markup on repairs$0.00
Setup fee$0.00
Total fees per year$2,800.00

Compare proposals on the yearly total, not the monthly percent: a lower monthly fee can cost more once leasing, renewal and markup fees are added. Setup is counted in the first year only.

See breakdown

How the property management fee calculation works

  1. Start with rent actually collected

    $2,000 a month with half a month vacant is $23,000 a year. Most managers charge their monthly fee on collected rent only.

  2. Apply the monthly fee

    A 10% fee on $23,000 is $2,300.

  3. Add the fees for new tenants and renewals

    A leasing fee of half a month's rent ($1,000) for a new tenant every two years averages $500 a year.

  4. Add flat fees, repair markup and setup

    Read the agreement for monthly tech or inspection fees and any markup on repairs. Here they're zero, so the total is $2,800, or 12.2% of rent collected.

Worked example. A $2,000-a-month rental with half a month vacant collects $23,000 a year. A 10% monthly fee ($2,300) plus a half-month leasing fee every two years ($500 a year) costs $2,800, or 12.2% of the rent collected. After $1,500 of repairs you keep $18,700.

Property Management Fee FAQ

How much do property managers charge?

Most charge a monthly fee as a percent of rent collected, plus a leasing fee when they place a tenant and sometimes renewal, setup and repair-markup fees. Enter the figures from each proposal to compare the yearly cost.

What is the average property management fee?

There is no official national average: no government agency publishes one, and fees are set in each management agreement. The 10% monthly fee and half-month leasing fee in this calculator are example inputs, not a benchmark. Get two or three written proposals for your property and enter each one to compare the yearly totals.

How is a property management fee calculated?

The monthly fee is a percent of rent collected, so $2,000 rent for 11.5 months is $23,000 and a 10% fee is $2,300 a year. Add one-time fees spread over the years they occur, such as a half-month leasing fee every two years ($500 a year). Divide the total by rent collected to get the real percent: $2,800 ÷ $23,000 = 12.2%.

What is a leasing fee?

A one-time fee for finding and placing a new tenant, often a percent of one month's rent. It's averaged over the years here by the number of new tenants per year.

Do property managers charge when the unit is vacant?

Many charge the monthly fee only on rent they collect. Check your agreement; some charge a flat minimum during vacancies.

Are property management fees tax deductible?

Yes, generally. IRS Publication 527 lists management fees among the common expenses of renting property, and you report rental income and expenses on Schedule E. Ask a tax professional about your situation.

Is a property manager worth it?

Compare the yearly fees with the time you'd spend on tenants, repairs and rent collection, and with any reduction in vacancy a good manager brings.

Sources: IRS: Publication 527, Residential Rental Property (rental expenses)

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