A recent survey by All Property Management of 300 property managers form around the U.S. demonstrates just one way that hiring a well-run property management firm is a good investment decision for most income property owners.
The following information comes directly from that survey and All Property Management:
"According to the US Census Bureau, the national average rental vacancy rate hovers around 9%, while our survey reveals that the average vacancy rate for professionally managed companies is about half that, coming in at 4.5%.
To calculate what this reduction means for the average rental
property owner's bottom line, we took a look at what it would mean for
the owner of a property valued at $150,000, with a monthly rent of
$1,250, assuming a 10% monthly property management fee. We found that,
when you take into account both lost rent and turnover costs, each 1%
drop in vacancy rate saves the property owner about $1,900 over the
course of a five-year period. Thus, a reduction of 4.5% equals a savings
of about $9,500 over five years. Meanwhile, at 10% per month,
professional property management would cost only $7,500 over the same
period, resulting in a $2,000 profit, which represents a 30% ROI.
All Property Management's survey also confirms that average turnover
costs total about $2,000---double that when there is an eviction, or
similarly challenging tenant situation, involved. Pair this with other
advantages of hiring professional property management, which include
time savings, the ability to command higher rents, and improved
maintenance at lower costs---just to name a few---we think payoff from
using a professional property manager is clear. It's the best investment
for making a solid real estate investment."
Contact Alarca Realty and find out how our property management processes and systems provide world-class customer service while also delivering industry-leading investment returns to our clients.
Thanks for share this valuable information about Professional Property Management Significantly Increases ROI. In this post very nicely describe Property Management's survey.
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All Property Management's study also verifies that regular income costs complete about $2,000---double that when there is an foreclosure, or in the same way complicated renter scenario, engaged.
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