What Do Airbnb Management Companies Charge?

What do Airbnb management companies charge?

Most long term property management companies charge a monthly fee of between 8% – 12% of the monthly rent collected. Getting an outside agency to manage your Airbnb or short-term let property is simple right? You sign on the dotted line, and they charge you a percentage for each booking on your account. Well, it’s not necessarily that simple. Each Airbnb service will have their own idea of what’s a fair rate for the service they offer, and how they’re going to charge you for the work they carry out. One of the biggest areas of contention relates to the additional or hidden fees that crop up to surprise owners, taking big chunks of profit from the figures originally forecast. What are the typical rates for Airbnb Property Management? Rates range from as little as 15% up to around 25%. Those are quite typical for an Airbnb service fee in Australia, yet in other countries, the top-end rates could be much higher. And, depending on where you’re located, your fees will be subject to VAT/GST. Why such variation? Well, the level of service changes from provider to provider, and there are factors due to the property itself that affect their charges.

Property Management Fees: What to Expect?

While the industry average is anywhere from 25 to 30% of the rental cost, the fees that are charged by the vacation rental property management companies vary. They vary based on the location of the property and the company themselves. They can go anywhere from 10% all the way up to 50%. The type of property also depends on the fee and the amount of work that you would like them to do. While this is just an idea, all fees should be negotiated with the company prior to working with them. The different types of vacation rental property managers know what fees work with them. Knowing how much property management companies charge for vacation rentals is a good thing and it gives you a heads up when hiring one.
  1. Size of the property
The bigger the property, the more work it’s likely to take to keep it in prime condition. The more work involved in managing your property, the more a management agency will charge.
  1. Type of property
Similarly to size, the type of property—an apartment, house, houseboat, terraced, detached, with or without grounds and gardens—all take varying amounts of effort and resources. Once again, the more work, the higher the rate
  1. Location of property
You can guarantee that if your property is in a high-rental area, the fees for its management will reflect that. Agents almost always charge rates to reflect the class and affluence of the area where the property is situated.
  1. A property’s condition
Suppose a property isn’t in prime condition, and agents foresee regular work to maintain its upkeep. In that case, once again, the rate will include any extras required to compensate for the additional effort.
  1. The service level
Each Airbnb service company offers a range of different services or levels of service. The most basic will charge the lowest rates. These usually manage checking in and out, and possibly the turn-round of laundry and necessary cleaning. A complete service that includes marketing, guest screening, rent collection, repairs, maintenance, accounting and more, will reflect their range of services in their rate. A Breakdown of Common Airbnb Property Management Fees

Here is a breakdown of specific property management fees to consider before renting out on Airbnb:

  1. Initial setup fee
When setting up an account with the company, some property management companies will charge you a registration fee. This fee might include costs for paperwork, initial advertising, and inspecting the condition of your Airbnb rental property.
  1. Tenant placement fees
If the property management company is responsible for finding tenants for your Airbnb rental property, they will charge you a tenant (guest) placement fee. This fee 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.
  1. Vacancy fee
The Airbnb property management agreement could have a clause that says a fee will be charged for vacancies. This could be a fee per vacant unit or a one-time fee that is paid upfront.
  1. Maintenance fee
Airbnb property maintenance involves tasks such as: Checking if the carbon monoxide detectors and smoke alarms are working well Ensuring that there are no bare wires hanging around the house   What do Airbnb management companies do? Repairing anything that guests have damaged. Ensuring the Wi-Fi is working. Checking if the water system is working everywhere – in the kitchen, the bathroom, and the shower. Making sure the heating and air conditioning systems are in good order. As an Airbnb property owner, you need to understand the company’s maintenance process. Here are some of the questions you need to ask the Airbnb property manager: Does the company have an in-house team? What is their turnaround time for a basic repair job? What maintenance issues do they have to outsource? Is there an emergency number that guests can call? When would they need to consult you as the owner? Asking these questions will show you if the Airbnb property management fees being charged are justifiable.
  1. Cleaning services
Your cleaning fees will vary depending on the size and location of your rental. While some property management companies include cleaning fees in their fixed rate, others charge it separately. When analyzing cleaning fees, here are some factors you need to consider:
  1. What exactly is included in the cleaning fees?
  2. How long does it take?
  3. How good is the cleaning?
  4. Are there check-lists in place?
  5. Will you be able to get the rental cleaned between guests without losing bookings?
Sources- https://www.housing.vic.gov.au/

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