By the Hospitable.com team
Thinking about hiring a property manager but are not sure whether it’s worth the cost? Should you pay someone to take care of the ins and outs of managing an Airbnb rental property for you, or is it better to DIY and keep the money?
There’s no right or wrong answer to this question. Ultimately, it all depends on your budget and the value of your time. So how much do property managers charge for their work? And what do property managers do? Read on to find out if hiring a property manager is right for your STR property.
How Much Does Property Management Cost?
Property management isn’t cheap, and the cost of hiring a property manager depends on many factors, including how much responsibility you want them to take on. In general, there are two pricing models: fixed-rate fees and commission-based fees.
With a commission-based property management fee, the manager will take a percentage of your monthly earnings. The charges will depend on the rental property’s location, as well as the services offered.
Generally, the average property management fees for short-term rentals could be anything between 25-40% of the rent collected. In general, commissions will be lower for urban properties than rural, mountain, or beach locations.
Long-term rentals are generally cheaper to manage because there are less turnover and involvement. So a monthly general management fee is typically between 8% and 10% of the monthly rent for a single-family home.
On the other hand, a short-term rental property requires regular cleaning and much more commitment (e.g., managing bookings on multiple channels, communicating with guests). That’s why commission-based fees for them are higher.
Some property managers may charge a flat rate for a specified set of services. This fee doesn’t change depending on the number of nights the rental property is booked in a month.
This pricing model can work out well for landlords whose properties are in high demand, with continuous bookings and occupation. But make sure you find out what is included in the fee because many companies charge additional short-term rental management fees on top of your monthly payment.
Breakdown of Property Management Fees
A property manager can take care of everything—it’s up to you to decide how involved you want them to be, but there may be additional fees. Here is a breakdown of the common fees a property manager may charge you.
- Setup fees are likely to include administration costs, creating paperwork and contracts, and an initial registration fee.
- Placement fees could cover advertising costs and tenant screening, as well as check-in and check-out procedures. This could be a percentage of the rent or a flat fee.
- Management fee—you’ll likely pay a percentage of the monthly rental income as a general management services fee.
- Vacancy fee—if bookings aren’t their responsibility, a property manager may charge you for each empty unit, or a one-off fee to cover the possibility.
- Maintenance fees—property maintenance issues are bound to come up, so you should expect to pay maintenance costs.
- Cleaning and laundry services fees vary due to the size of each property and how often they are required.
What Do Property Managers Do?
Property managers can help ensure your passive income actually stays passive. Their responsibilities can range from a little bit of assistance with handling bookings to a full package of support services.
Here is what they can do for you to help you with the day-to-day running of your property:
- Setting the right rental rates based on market research to ensure your listings are priced competitively;
- Marketing your property: taking professional photos and actively updating your listing on popular STR platforms;
- Verifying your guests are good guests through their prior ratings and reviews;
- Communicating with your guests to ensure a perfect guest experience;
- Managing maintenance and repairs to ensure that everything is working
How to Save on Property Management Costs
Renting out a house on Airbnb can be a great way to generate income, but managing a rental property is a challenging job that involves a lot of responsibilities and requires time. A good property manager can make running a vacation rental property much easier (they can do everything for you), but that comes with high property management costs.
Still, an efficient alternative allows you to manage your STR property yourself without investing much time. Vacation rental software like Hospitable.com can help you scale many of the responsibilities and daily operations while keeping more of your rental revenue.
Time-saving opportunities await
Hospitable.com will automate guest communication on Airbnb, Booking.com, and Vrbo, sync your calendar and pricing across platforms, and send reminders to your team members to notify them about new tasks.
You can start with a free 14-day trial and then pay a reasonable flat fee covering the first two listings on Airbnb. All listings on Vrbo and Booking.com are free of charge.
Hospitable.com makes managing properties easier, removing the operational headaches while you perform many of the core responsibilities. Let’s take a look at some of the key advantages of our system.
You will be able to manage and update all your listings across multiple channels from a centralized synchronized dashboard. You can streamline communication with your guests by scheduling automatic messages triggered by such events as new booking requests, check-in, check-out, new inquiry and many more.
The Hospitable question feature allows you to set automatic answers to your guests’ questions. Our system uses AI to scan guest messages and automatically detect questions on more than 20 common topics. It will send an instant automated response on your behalf.
With Hospitable, you’ll be able to create your own business website to get direct bookings and be less dependent on OTAs. By getting direct bookings, you’ll be able to build up your brand and create your own pool of loyal customers.
We will protect you from double-booking and overbooking with instant calendar synchronization. You can integrate your Hospitable account with PriceLabs and use PriceLabs’s dynamic pricing on all properties seen on Hospitable that will help you increase your revenue.
By automating all of these management tasks with Hospitable.com, vacation rental owners can save on property management fees and run their business on autopilot.
All your STR business in one convenient window
Start today with a 14-day free trial.
Managing one or more Airbnb properties can be time-consuming and stressful. Hiring a property manager to help with the day-to-day running of their properties can be a good option for busy hosts, but it involves paying high property management fees.
An alternative cost-effective solution is using good vacation management software like Hospitable.com. Our platform provides many valuable features for hosts to help them manage their rental properties on Airbnb, Vrbo, and Booking.com and automate communication with guests.
Airbnb automation can help remove the stress from the equation of managing your STR business and give you more free time to focus on providing exceptional guest experience and increasing profits or spend this time on things you care about.
Airbnb management software is being used by thousands of property managers worldwide to scale up their operations on Airbnb.
But, is it reserved just for property managers?
Or, is it something that everyday hosts like you and me can use too?
If you manage multiple units, this quickly turns into a full-time job. That’s why many hosts choose to outsource some or all of these tasks.
But how do you decide which tasks to outsource? That’s an important decision every host has to make.
Let us help you make this decision!