Self-managed five units for 14 months to save the fee, down about $7,600

The lease you used matters more than the fee you saved. Owner-drafted or template leases are where I see the deposit handling and the notice language go wrong, and both of those are governed by state statute, so a lease that works two states over can be unenforceable in yours. Have one reviewed by an attorney licensed where the property sits, once, and then use it. Separately, taking half a deposit created a documentation problem on top of the collection problem, because now the deposit ledger does not match the lease and any accounting you owe at move-out gets messy.

27 days on market against 14 is the whole post. On my small multifamily I track cost per vacant day as a single number and it makes every fee argument simple. At $920 rent your vacant day is roughly $30. A manager who shortens each turn by 10 days on four turns saves $1,200, and the base fee on those four units is what, $3,300 a year. Close enough that the maintenance question decides it, and you already win the maintenance question.

Does the leasing-only arrangement usually come with screening included, or is that a separate charge? I am years from owning anything and this is the kind of structure I want to understand before I need it.

So the leasing-only idea works like this? Instead of paying a percentage of rent every month, you pay a one time fee when a unit turns over, and the manager finds and screens the tenant and then hands them back to you? What happens if that tenant stops paying in month four, is that yours?

juniper, yes, that is the shape of it. A tenant placement or leasing-only engagement is a one-time fee, commonly half a month to a full month of rent, covering marketing, showings, application processing, and lease execution. Ongoing rent collection, maintenance coordination, and any collection problem stay with the owner. Some firms offer a limited placement warranty, typically re-leasing at no fee if the tenant fails inside a stated window like six or nine months, and that term varies by firm so get it in writing.

harrow, the numbers in your post point at where the money is. Base management on five units at 9% of $55k is about $4,950 a year. Your measured loss came almost entirely from days on market and one screening failure, which are both leasing functions. Buying leasing alone at one month of rent per turn is roughly $920 per event, and at four turns in fourteen months that is $3,680, against $4,900 of vacancy loss plus $4,300 on the placement. That comparison only works if two things hold. First, your turnover rate stays high, because four turns on five units in fourteen months is heavy and if you retain tenants longer the leasing fee stops recurring. Second, you can genuinely absorb the collection and compliance side yourself, and your notice mistake suggests that piece needs an attorney-reviewed process before you rely on it.

One thing to price honestly. Screening criteria have to be applied the same way to every applicant, and fair housing rules on that are federal with additional state and local layers, so the value of a placement service includes a documented process you would otherwise have to build.

I will push back a little. Self-management works fine, it just does not work part time. My days on market on thin margin rentals is under 14 because I have a saved listing template, a scheduling link, a screening standard I do not bend for anybody, and I answer inquiries inside two hours. That is not talent, it is four things set up once. harrow, you did not lose to self-management, you lost to showing units on weekends after job sites and to liking the guy. The half deposit is the tell.

flint is right about the deposit and it is the mistake I keep making in other forms. My near miss was letting a tenant move in before funds cleared because the truck was already at the curb. Cost me two months. The rule I wrote down after was that money and keys move at the same time, no exceptions, and it has never once been convenient.

Cost per vacant day is such a simple number and I have never once seen it in anything I have read about buying rentals.

The break point in my experience is between six and eight units, and it is not the maintenance that breaks. It is accounting. Five units you can hold in your head and a bank statement. At nine I had deposits in the wrong account, a repair I billed to the wrong property, and no idea what my actual expense ratio was per building, which meant I could not tell whether one of them was a dog. That is the month I hired someone. harrow, if you are staying at five, at least separate the ledgers now while it is easy.