| by Kenneth Chase | No comments

Why Free Management Fees Are a Scam | Property Management | Welcome Home Rentals

Free is such a great word isn’t it? Getting
something for nothing is enough to get many people excited and can be extremely tempting
for those investing in property. Between rates and insurance, smoke alarm testing, repairs
and interest rate hikes, it’s no wonder that the idea of free property management
is appealing. Here’s why you should run away from agents
who are dangling the free management carrot: 1. They will rent your property to ANYBODY
just to get the job done. The sooner somebody is in the property, the sooner they can turn
their attention to one of the dozens of other investors they have lured with their promise
of something free 2. Because you aren’t paying, there is no
sense of obligation for the agent. Didn’t do their job properly? What leg do you have
to stand on when you haven’t paid anything for the service?
3. An agent who isn’t charging management fees can only stay afloat for so long. A properly
managed investment property should cost the agency approximately $500 to $750 per year
to service. Therefore, the agency isn’t only “not earning” money when they manage
for free but they are actually SPENDING money to manage for free. The only way for an agent
to counteract the loss is to cut back on things like managing arrears, proactive lease renewals
and thorough inspections. Rather than looking for free, look for VALUE
FOR MONEY. Selecting a property manager is not the time to be stingy – choose a great
agent and you’ll come out way ahead of looking for the cheapest.

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