There are two answers to this question, depending on the situation.
If a prospective tenant hires a real estate agent to help them find a rental, the agent is usually paid a commission that is equal to one months rent of the place the prospective tenant ends up signing a lease for. The commission is only paid if the agent was the one who showed / introduced the property to the prospective tenant. If the prospective tenant found the property on their own, with no help from the agent, no commission is paid.
If a landlord hires a real estate agent or company to perform property management services such as collecting rents, handling repairs, evictions, and renting to new tenants, the real estate agent or company is paid 10% of the gross rents each month. For example, if the rents are $800 a month, the real estate company would receive $80 a month.
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Additional Matches: Commission for rental property. Agent’s commission on rentals.
For clarification, real estate fees charged by a property management company may well vary in different locations. The fees are normally agreed to by the owner and the property manager in contract form. Some companies may charge the first month’s rent and then 6 to 10 percent of the gross rent – or some variation. All real estate fees are negotiable.
As a real estate investor (and broker) I look at the services provided by the rental company and the costs related with those services, and the reputation of the firm before I choose a property manager.
Also, whenever a buyer or tenant hires a real estate agent/broker for representation, there should be a signed agreement between the two defining how much is to be paid, under what conditions, and how long the agent/broker has to accomplish her task.
Don Loyd, Author
Comment by Don Loyd — March 30, 2008 @ 8:30 am“Creating Wealth for Women”
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