What do property management fees actually cost over a year? The monthly percentage is only part of the answer. A landlord may also pay a leasing fee when a new tenant moves in, a setup fee, or charges for specific work. The total depends on the management agreement and what happens at the property.
This guide explains common fees for property management, shows how to calculate an example annual cost, and gives Clarksville rental owners questions to ask before signing an agreement. It also explains Connerth & Co.’s published fees so owners can see how a real fee schedule works.
What is a property management fee?
A property management fee pays for the ongoing services described in an owner’s agreement. These may include rent collection, tenant communication, maintenance coordination, recordkeeping, and owner reporting. The exact work included differs between companies, so a percentage alone does not tell you what you are buying.
Companies may charge a percentage of rent or a flat monthly amount. If the fee is a percentage, check whether it is based on rent collected or rent charged. Those amounts can differ when a payment is late, only partly paid, or a property is vacant. Also ask whether the agreement has a minimum monthly charge.
Connerth & Co.’s published property management fees
For its Clarksville landlord services, Connerth & Co. currently publishes the following fees:
- Monthly management fee: 10% of monthly rent collected.
- Leasing and placement fee: $400, including tenant screening and move-in coordination.
- Direct deposit setup fee: $35, charged once.
These are the published figures, not a quote for every possible property expense. Review the management agreement for the services included, when each fee is charged, and whether any other charges could apply. You can see the current figures on the Clarksville landlord services page.
How does a percentage management fee work?
Suppose a rental collects $1,500 in rent in a month. A management fee of 10% of rent collected would be $150 for that month:
$1,500 collected rent × 10% = $150 management fee
If the property collected $1,500 every month for 12 months, those monthly fees would total $1,800. That calculation assumes full collection throughout the year. Actual collections can change, and the agreement should explain how fees are handled when rent is late, partly paid, or not collected.
What might the first year cost?
Here is an illustration using Connerth & Co.’s published fees and a rental that collects $1,500 each month. It assumes one new tenant placement and one direct deposit setup during the year:
- Rent collected: $1,500 × 12 months = $18,000
- Monthly management fees: 10% × $18,000 = $1,800
- One leasing and placement fee: $400
- One direct deposit setup fee: $35
- Illustrative total of these fees: $2,235 for the year
This is a calculation, not a promised annual price or return. A year without a new placement would not include the illustrated placement fee. The example also excludes property ownership and operating costs such as repairs, insurance, taxes, utilities, and vacancy. The agreement and actual activity determine the amount an owner pays.
What other charges should landlords ask about?
When comparing property management companies, ask for the complete fee schedule. Depending on the company and agreement, charges to clarify may include:
- Leasing or tenant-placement fees: What work is included, and when is the fee due?
- Lease-renewal fees: Is there a charge when an existing tenant renews?
- Inspection fees: Which inspections are included in regular management?
- Maintenance coordination charges: Does the company charge separately for arranging repairs or add a markup to vendor invoices?
- Advertising or photography: Are listing preparation and marketing included in leasing?
- Setup and termination fees: What does onboarding cost, and what happens if either party ends the agreement?
This list describes fees to check for; it does not mean Connerth & Co. charges each one. Ask every company to identify which charges apply to the property you own.
Are repair costs included in the management fee?
Do not assume that paying a management fee pays for the repair itself. Coordinating a plumber and paying the plumber’s invoice are different costs. Ask who selects vendors, what spending amount requires your approval, how emergencies are handled, and whether the manager charges for coordination or marks up invoices.
For budgeting, keep a separate allowance for routine maintenance and larger replacements. A low management fee cannot make an aging roof, HVAC system, or appliance free to repair.
How to compare two property management quotes
Put each proposal on the same footing. For your expected monthly rent, estimate one year of management fees, then add the fees likely to arise from leasing, renewals, inspections, and other services. Review the work included alongside the price.
- Is the monthly fee based on rent collected or rent charged?
- Is there a minimum fee when the home is vacant or rent is unpaid?
- What is included in tenant placement and screening?
- Are renewals, inspections, owner statements, and routine communication included?
- How are vendor bills approved and paid?
- What additional charges appear in the agreement?
- Who will communicate with you, and how often will you receive reports?
- What notice and fees apply if you end the agreement?
Cost matters, but so does the service you receive. A clear agreement should make it possible to understand both. For a broader decision framework, read our guide to the pros and cons of hiring a property management company.
When might paying for management make sense?
Consider the fee alongside the time and work you would otherwise spend managing the rental. Owners who live away from Clarksville, manage multiple homes, have limited availability for tenant calls, or need a more organized maintenance and reporting process may find professional help valuable.
Self-management can also be a reasonable choice for an owner with the time, local contacts, and systems to handle the work. Neither option guarantees better financial results. Compare the total cost, the services provided, and the responsibilities you want to keep.
Frequently asked questions
What does “10% of rent collected” mean?
It means the percentage is calculated using rent actually collected, rather than simply the rent listed in the lease. For example, 10% of $1,500 collected is $150. Check the agreement for how partial payments, late payments, and any minimum fees are handled.
Is a leasing fee the same as a monthly management fee?
No. A leasing fee generally relates to finding and placing a new tenant. A monthly management fee relates to ongoing work during the tenancy. Check the agreement to see what each fee covers and when it is charged.
Will I pay a leasing fee every year?
That depends on whether a new tenant is placed and on the agreement’s terms. Do not build a leasing fee into every year of your estimate without checking when it applies.
What should I request before hiring a property manager?
Ask for the complete fee schedule and management agreement. Review the services included, owner approval limits, handling of maintenance invoices, reporting, and how the agreement can be ended. Compare the likely annual cost for your own property rather than comparing monthly percentages alone.
The practical takeaway
To understand fees for property management, calculate the monthly charge and then account for leasing, setup, and any other applicable fees. Read the agreement closely enough to know which work is included and which property costs remain yours.
If you own a rental in Clarksville or Montgomery County, you can review Connerth & Co.’s published services and fees and request details for your property.
