Getting an outside agency in 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 10% up to around 25%. Those are quite typical for an Airbnb service fee in the UK, 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.
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.
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.
2. 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
3. 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.
4. 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.
5. 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.
Airbnb property management fee types
We’ve suggested some typical commission rates, and they’ll be charged on a monthly basis, or with each booking that the agency handles.
Some agencies offer a fixed monthly fee to manage your property (or properties) for as many or as few bookings as you need. It can work out great for a landlord whose property is in high demand, with continuous bookings and occupation. This type of property will require more cleaning, more laundry, and more turnover work, and the rate will appear quite fair over the course of the year.
For a property that is only busy during peak periods, then it might or might not offer quite the same economy.
Additional or hidden service and management fees
What’s included in your management service can be a minefield. Every landlord should scrutinise the terms and conditions of each service before making a decision. What features in one contract could be excluded from another, carrying an additional fee where the work is required.
Some of the lower rate services, especially, will find ways to bump up their income, many of which are hidden in the fine print.
Here are a few typical areas to be wary of:
These are likely to include administration costs, creating paperwork and contracts, and an initial registration fee. There may be fees to create advertising accounts and possible initial property visits and inspections.
Although most management services include advertising and bookings, it could be one of the areas to fall between the cracks. Will they consider guest screening as part of the booking service? How about the physical checking in and out of guests? You would assume these elements to be included, but make sure you’ve got confirmation before signing on the dotted line.
How can your management service make an income if the property is vacant? To cover themselves—if bookings aren’t their responsibility—they may charge you for each empty unit, or a one-off fee to cover the possibility.
Who’s in charge of what is a major concern. If all maintenance is included, then you can expect your agency to manage the WiFi in the building, heating, water, plumbing and electricity, smoke and carbon monoxide detectors, air conditioning and any of the other regular services.
They should also handle repairs, décor and upkeep of the property. If they don’t, you can expect to receive some generous invoices for the additional work.
Cleaning and laundry services
Cleaning and laundry fees vary due to the size of each property and how often they are required. Many services will have a set rate for cleaning and laundry services for each stay, able to offer a fixed rate, but some will outsource, and that could mean an hourly charge instead.
When you choose UpperKey there are no hidden fees—ever.
You can forget all about being charged any hidden or Airbnb service fee ever with UpperKey. Our guaranteed rent means precisely that.
We agree on a set rate for your monthly rent payment, and that’s what you’ll receive.
There won’t be any surprises or sneaky added costs anywhere. We’ll take care of every aspect of running your property—and it’s all included in your payment.
So, when you’re thinking of signing up for a management service, you shouldn’t have to think too hard. We won’t only save you time and money when it comes to managing your property—but comparing contracts and services too!
With an all-in service and simple single rent payment, what could be more convenient?