Property Management Fees Explained: What Do You Really Pay For?

Property management fees are often one of the most misunderstood costs of owning a rental property. Many landlords focus only on the advertised management percentage, but the real cost usually includes a range of service, administrative, and transactional fees that can directly affect your net rental return. Without a clear breakdown, these charges can come as an unwelcome surprise. 

This guideline helps you understand exactly what property management fees cover, identify hidden or overlooked charges, and assess whether you are receiving genuine value for the services provided.

Common Property Management Fees for Landlords

1. Property management fee

The property management fee is an ongoing charge, usually calculated as a percentage of the rent, covering the daily operation of your rental property. This fee pays for professional oversight, compliance, and tenant communication, helping landlords save time and reduce risk. It typically includes the following services:

• Rent collection & arrears management: Ensures rent is paid on time, follows up late payments, and reduces cash-flow issues.
• Tenant communication & issue handling: Acts as the main contact for tenant enquiries, complaints, and day-to-day concerns.
• Maintenance coordination: Arranges and oversees repairs using approved contractors, protecting the property’s condition.
• Lease compliance & tenancy administration: Manages notices, rent reviews, and ensures actions follow tenancy laws.
• Owner reporting & financial statements: Provides regular income and expense reports for transparency and tax preparation.

2. Letting / Leasing Fee

The letting or leasing fee is a once-off charge payable by the property owner when a new tenant is placed in the property. This fee covers the agent’s efforts in advertising the rental, responding to enquiries, holding inspections, assessing applications, and finalising the lease documentation. 

By paying this fee, owners benefit from a professionally managed leasing process that follows tenancy regulations, minimises vacancy time, and helps secure reliable tenants. The cost is usually equivalent to one to two weeks’ rent or set as a fixed amount by the agency.

3. Advertising & Marketing

Advertising and marketing fees cover the cost of promoting a rental property to attract suitable tenants as quickly as possible. Property owners pay for professional listings on major rental platforms, agency websites, and sometimes signboards, photography, or floor plans. These fees help maximise exposure, reduce vacancy periods, and position the property competitively in the market. 

Depending on the level of marketing required and platforms used, advertising costs are usually charged separately and can range from a few hundred dollars to higher amounts for premium listings.

4. Inspection & Admin Fees

Inspection and administration fees relate to the ongoing management and compliance of a rental property. These charges may cover routine property inspections, condition reports, tenancy paperwork, and general administrative tasks. 

Owners pay these fees to ensure the property is regularly checked, maintenance issues are identified early, and all records meet legal requirements. Some agencies include these services in the management fee, while others charge separately as fixed or per-inspection co

Additional Property Management Fees Landlords Often Overlook

5. Lease renewal

The lease renewal fee is charged when an existing tenant extends or renews their lease. Although no new tenant is found, the property manager still completes administrative and legal work, including reviewing rental pricing, preparing updated lease documents, and ensuring compliance with current tenancy laws. 

Owners pay this fee for the convenience of having the renewal handled professionally and correctly. This cost is often overlooked and is typically charged as a fixed fee rather than a percentage of rent.

6. Maintenance markup

Maintenance markup refers to an additional percentage added to the cost of repairs or maintenance arranged by the property manager. This fee covers the time spent organising contractors, approving quotes, supervising works, and handling invoices. While some agencies include this service at no extra charge, others apply a markup, often 10–20% of the repair cost. It can be an unexpected expense if not clearly disclosed in the management agreement.

7. Tribunal fee

When a rental dispute cannot be resolved and proceeds to a formal tribunal or tenancy authority hearing, a tribunal fee may be charged to the property owner. This fee accounts for the property manager’s involvement in preparing case documents, submitting applications, and, where required, attending or representing the owner at the hearing. Owners pay this cost to ensure the matter is managed correctly and in line with legal requirements. The amount charged varies based on the complexity of the case and the level of representation needed.

8. Annual statement fee

Annual statement fee is charged for preparing an end-of-financial-year summary of rental income and expenses. This statement helps owners with tax reporting and financial planning by clearly outlining rental performance over the year. While the task is largely administrative, it saves owners time and reduces errors when working with accountants. This fee is usually a small fixed amount and is commonly overlooked when reviewing management costs.

These are common property management fees and services. Actual fees, tax deductions, and accounting methods can vary, so property owners should confirm how these costs apply to their specific situation with an accountant.

Explore more: Rental Property Tax Obligations: A Checklist for Property Owners

What Affects Property Management Fees

Property management fees are not fixed and can vary widely depending on several key factors. Understanding what influences these costs helps landlords compare agencies more effectively and choose a service level that matches their property and investment goals. Below are the main elements that affect how much property management fees may increase or decrease.

• Property location: Properties in high-demand or inner-city areas often attract lower management fees due to strong rental demand, while regional or remote locations may cost more because they require additional time, travel, and effort to manage.
• Type of property such as apartments, houses, and multi-unit properties differ in complexity. Larger or high-maintenance properties typically involve more coordination and oversight, which can increase management costs.
• Rental type (long-term vs short-term): Short-term rentals usually attract higher fees as they require frequent guest communication, bookings, cleaning coordination, and ongoing monitoring compared to long-term tenancies.
• Level of services included: Comprehensive management packages with inspections, reporting, and maintenance coordination generally cost more than basic, rent-collection-only services.

Why Do You Need a Property Manager?

A property manager plays a vital role in protecting your investment, saving time, and reducing legal and financial risks associated with managing a rental property. A property manager helps by:

• Ensuring compliance with tenancy laws and safety regulations: Keeps leases, notices, and property standards aligned with current legal requirements, reducing the risk of penalties or disputes.
• Screening tenants and managing lease agreements: Assesses tenant suitability, prepares compliant leases, and manages renewals or terminations professionally.
• Handling rent collection, arrears, and disputes: Monitors payments, follows up late rent, and manages tenant issues before they escalate.
• Coordinating maintenance and inspections: Organises repairs and routine inspections to protect the property’s condition and value.
• Providing accurate records for tax and reporting purposes: Maintains clear financial statements to support tax reporting and long-term planning.

Discover Snowy Mountain – Your Trusted Property Management Partner 

Understanding property management fees empowers landlords to plan with confidence, avoid unexpected costs, and choose services that genuinely support their investment goals. When each fee is clearly explained, it becomes easier to compare providers, evaluate transparency, and ensure your property is managed to a professional standard.

With Discover Snowy Mountains, owners benefit from straightforward fee structures, strong local knowledge, and proven management systems designed to protect property value and drive long-term performance. If you’re considering property ownership or investment opportunities in Australia’s alpine regions. 

Contact us today to discover the area’s lifestyle appeal and why it continues to attract property investors.