If you are an investor who wants to lease out your property, one of the most important things that you would want to know is how much a real estate agent will charge to lease out your property. Real estate agents in Australia do charge a fee for their property management services, and this differs based on location, services offered, and agent experience.
Types of Rental Fees Charged by Real Estate Agents
Real estate agents generally charge two main types of fees when managing rental properties:
Management Fees
The management fee is an ongoing cost that handles the day-to-day management of your rental property. It covers rent collection, responding to tenants’ inquiries, processing maintenance requests, and ensuring legal compliance.
- Average Cost: It is generally between 5% and 12% of the weekly rent, based on the state or territory.
- Factors Affecting Cost: Market conditions, agent’s experience, and quality of service provided.
Leasing Fees
The leasing fee is one upfront payment for finding and securing a tenant. This includes marketing the property, conducting open inspections, screening applicants, and documenting agreements.
- Average Cost: Usually equivalent to one or two weeks’ rent.
- What’s Included: Advertising, tenant selection, and documentation.
Additional Fees to Consider
Apart from leasing and management fees, property owners need to be aware of additional fees, including:
- Advertising Fees: Some agents charge separate fees for marketing, while others include it in the leasing fee.
- Routine Inspection Fees: Some agencies charge a small fee per inspection.
- Renewal Fees: If an existing tenant renews their lease, agents may charge a renewal fee, typically a small percentage of the rent.
- Administration Fees: Some agencies charge a minor monthly or annual fee for administrative costs.
State-by-State Breakdown of Rental Fees
The percentage of management fees can vary depending on location. Here’s a general overview:
- New South Wales (NSW): 5% – 8%
- Victoria (VIC): 5% – 8%
- Queensland (QLD): 7% – 12%
- Western Australia (WA): 8% – 10%
- South Australia (SA): 7% – 10%
- Tasmania (TAS): 7% – 10%
- Australian Capital Territory (ACT): 6% – 9%
- Northern Territory (NT): 8% – 12%
Are Property Management Fees Negotiable?
Yes, most real estate agents are negotiable, particularly for landlords with several properties. Although lower fees are appealing, you must make sure that the agent offers quality service because poor management can result in expensive vacancies or damage to your property.
Final Thoughts
In selecting a property manager, do not only consider fees. Look at their performance record, communication, and level of service. A quality property manager can assist in maximizing rental income and reducing stress and legal risk.