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If you’re a landlord trying to decide how to handle management for your rental property, you may have thought about using lease-only services for marketing and resident placement.
Here at Evernest, we offer lease-only services in some of our markets for landlords who prefer to manage their properties themselves. But, to be totally transparent, we often find that full property management services are preferable for a few different reasons.
In this article, we’ll explore what a lease-only agreement is, how it compares to full property management, and why you might choose one over the other. Let’s dive in!
What Are Lease-Only Services?
Lease-only services are designed to help landlords find and secure quality residents without getting into the day-to-day management of a rental property. Typically, these services include:
Marketing and Advertising: Full-scale advertising for your property across multiple platforms, ensuring it reaches a broad audience of potential renters.
Resident Screening: Thorough background checks, credit checks, and rental history reviews to ensure you’re getting reliable residents.
Lease Agreement Preparation: Preparation and execution of a lease agreement, ensuring you have a legally sound agreement tailored to your property’s needs.
This service can be a good fit for landlords who live nearby and are comfortable handling the ongoing management of their property but need help securing the right residents.
How Does Lease-Only Compare to Full Property Management?
While lease-only services cover the essentials of resident placement, full property management services go much further. Full management services provide A-Z support, which becomes even more valuable when unexpected issues or situations arise, taking away time from your life and other projects or trips. It’s important to consider the value of protecting your time when considering lease-only vs. full management services.
Let’s take a look at how they compare in three key areas:
Ongoing Management
Full property management includes all of the elements in lease-only, plus rent collection, maintenance coordination, resident communication, eviction assistance, and lease renewals. Lease-only leaves the ongoing, more complex and time-consuming tasks in the hands of the landlord.
Maintenance and Repairs
One of the most time-consuming aspects of property management is maintenance and repairs. With lease-only services, you are responsible for fielding and managing all requests and issues with your property. This can quickly snowball into stress if your property requires a lot of attention. With full property management services, a provider fields all maintenance requests, coordinates repairs, and conducts routine inspections, saving you countless hours and headaches.
Legal Compliance
With lease-only services, you’ll get a fully compliant lease agreement tailored to the specifics of your property. This is incredibly important for the long-term success of your property as it safeguards you from potential issues in the future. But there’s potential for complex situations to arise with your residents past the leasing phase such as unpaid rent, resident issues, and even eviction. Full property management services provide support and expert handling of sensitive situations so you’re never left to handle a potentially damaging situation alone.
Pros and Cons of Lease-Only Services
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When considering whether to commit to lease-only services, it’s important to weigh the pros and cons, especially in comparison to full property management.
Pros of Lease-Only:
Professional Resident Placement: You get the benefit of a provider’s expertise in property marketing, thorough screening, and lease agreement preparation helping you secure reliable residents.
Control Over Management: For landlords who enjoy being hands-on, lease-only allows you to maintain full control over day-to-day management after resident placement.
One-Time Cost: Lease-only typically involves a one-time fee, which may be preferable to some landlords, depending on their financial situation.
Cons of Lease-Only:
Ongoing Responsibilities: All ongoing management tasks, including maintenance, rent collection, and resident communication, are your responsibility after the resident is placed.
Time and Effort: Managing a property can be time-consuming, especially if issues arise that require immediate attention. This leaves less time for you to spend on other projects.
Potentially Higher Long-Term Costs: It’s common for lease-only services to come at a premium. They might even come out to a similar cost when compared to full management services. The ongoing responsibilities of a landlord can also lead to higher long-term expenses, particularly if resident turnover is high or maintenance issues arise.
Comparing Costs
With Evernest, our lease-only services are equivalent to one month’s rent while our leasing fee with full management is 50% of one month’s rent. This is an instant savings of 50%! Our monthly management fee sits at 10% of the monthly rental rate and is capped at $199. With this structure, our full management services pencil out to be a better investment not only for your money but also for the time you save if not managing a rental property full-time.
Let’s take a look at an example cost comparison to illustrate the pricing structure and savings potential with Evernest’s full property management services vs. lease-only services.
If your property rents for $3,000 per month:
Lease-Only Service Fee: $3,000 (equivalent to one month’s rent)
Leasing Fee with Full Management: $1,500 (50% of one month’s rent)
Ongoing Management Fee: $199 per month (capped)
Savings: By choosing full property management, you save $1,500 upfront, which effectively covers 7.5 months of management fees
With this structure, you’re essentially getting 7.5 months of free property management! Paired with our 100% happiness guarantee, allowing you to cancel without cost at any time, you’re able to try out Evernest’s full-service management with minimal financial risk. You can then invest the time you save when not actively managing a property into the people or projects you care about most.
Final Thoughts: Lease-Only Agreements
Lease-only services are a great option if you prefer to handle the day-to-day tasks that come with property management and just need expert support finding and placing great residents. After all, some landlords prefer to be actively involved in the management of their rental property, no matter the financial picture. In these situations, lease-only services are usually ideal.
If you’re looking to enlist professional property management support though, covering leasing and beyond, consider Evernest’s full management services. Our wealth of expertise makes the property management process seamless and gives you back countless precious hours. With Evernest’s transparent pricing and satisfaction guarantee, you have the flexibility to choose the service that best meets your needs and can even test full-service management at no risk.
If you’re ready to get started, find the Evernest team in your area today!