Hello everyone,
I'm about to let my property out as a holiday rental. There are onsite managers to do this and they have given me a contract. As this is a first for me I don't know whether the rates are reasonable and where to seek advice? I've spoken to lawyers but they say they deal with the contract itself not the values, commissions, charges etc in it. I can see that they are charging me the maximum commission but for things such as termination notice, repairs and maintenance etc I am unsure if they are reasonable. Basically I want to know whether the rates are normal, reasonable, or extortionate and what I can and can't negotiate. I don't really have much choice as I need to let the property quickly and this is the most flexible option but at the same time i don't just want to accept it if things are unneccessarily high. Where would I find information on this? Or can anyone give advice here on these figures, percents, and fees?
Very confused!
Thank you very much in advance!Best bet is to ring some other similar managers in the area and see what charges they have. On top of this the relevant state real estate authority website may have some information.
As a rule of thumb you will find osm + holiday rentals will be on the high side anyway.
expect to ‘lose’ 50% to management, cleaning, linen & outgoings. Still sounding attractive?
KMMK, where is the property located? Can you rent it out yourself privately? whilst you figure out what fees and charges are acceptable. Have you spoken to anybody else in the area that rents their house out as a holiday rental…. they may be able to help you out
"expect to 'lose' 50% to management, cleaning, linen & outgoings. Still sounding attractive?" – Not via all agencies.. however yes most onsite managers do charge excessively.
Where about's is the property situated? This can make a difference.
Regarding the fees and charges that they can bill an owner.. unfortunately this is not regulated. The only rule that must be followed is they are not allowed to charge anymore than the maximum REIQ rate of 12%.
Some agencies do not charge the maximum.
Contract periods vary, depends which agreement you are entering into.. is this a standard holiday let or are you talking about a lease back situation with an accommodation provider?
Every onsite manager/agency will charge different rates for cleaning, linen hire, etc and it is important to shop around. Many people don’t realise that they do NOT have to let the property with the onsite manager. They can use an outside agency if they wish to do so.
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