How Much Do Airbnb Property Managers Charge? Understanding Property Management Fees

So, you've decided that it's time to hire a property manager for your vacation rental business. However, you don't know the costs and fees you'd need to pay. Most professionals and management companies charge anywhere from 10%-40% of your rental income. From there, you can kind of lay down a baseline of the fees you can expect.

As rental property owners and managers of a 25-rental-wide portfolio across different states, our team knows a thing or two about how these things work. And based on our experience, management fees can vary widely, depending on a variety of factors. So, today, we'll guide you through everything you need to know about Airbnb management costs and fees.

Types of Airbnb Property Management Fees

Throughout the years, we've seen three main ways of how Airbnb property manager charge for their services. This can be percentage-based, a fixed fee, or a monthly salary. The type of fee and how they charge it will mainly be dependent on the property management companies or individuals you hire, as there's really no one-size-fits-all solution.

Percentage of Booking Revenue

Most short-term rental management services will usually have a percentage-based fee structure. It's been a standard for a while now, so most professionals you encounter will likely charge a percentage of your booking revenue as their form of payment.

Unfortunately, the specific percentage is less standard, making the exact value vary greatly. Local managers can charge you around 10%-20%, more established professionals could be around 20%-30%, while companies will likely charge higher management fees of around 30%-40%. Of course, there are other factors that influence the specific value, which we'll discuss a bit later on as well.

Overall, percentage-based fees are likely the best choice for many property owners. It encourages the property manager to maximize your rental income because they'll greatly benefit from it as well. The only downside is that it can vastly fluctuate, depending on your location's seasonality patterns.

One piece of advice we can provide you is to always clarify and communicate the exact percentage and where it will come from. Will it be based on the gross revenue? net profit? maybe the rental income? We've learned the hard way that it can lead to very messy meetings if you're entirely clear on both sides.

Flat Fee Per Booking

This is a pretty straightforward pricing structure. It's simple because managers just charge short-term rental owners a fixed fee for every successful booking. Short-term rental property managers can base their prices on your nightly rate and the services they have to provide for your rental. In our experience, it can cost anywhere from $50 to $200. However, they can also charge higher fees due to increased responsibilities, or for properties with higher nightly rates.

This structure is quite uncommon but can be great for rentals with a consistent booking rate all year round. It can also make it easy to calculate Airbnb management fees because of the less complex arrangement.

Monthly Management Fee

The final pricing structure we've encountered is the monthly payment setup. This is the rarest among all types and we've only experienced it in vacation rental management companies. However, we've also heard of some short term rental property managers, specifically those in Asia to charge monthly fees, similar to those of a standard salary.

It's not much different from the fixed rate per booking, but can be very disadvantageous if your rental experiences a huge variety in occupancy rates throughout the year.

Aside from these standard vacation rental management charges, different Airbnb managers and companies can also ask for additional fees for extra services. This can include add-ons due to cleaning fees, maintenance, listing management, and more. So, just make sure to ask and clarify all of the various costs involved before signing that management contract.

Factors Affecting Airbnb Property Management Fees

Now that we've talked about the different structures, it's time to get a bit more familiar with the factors influencing Airbnb fees. There's a handful of them, and they can honestly be pretty inconsistent since it's largely dependent on the individuals themselves. However, the best Airbnb management professionals will typically base their rates according to these six factors.

Type of Management Needed

The first and probably biggest factor influencing the prices of professional management fees is the type of service you're availing. There are a handful of types of Airbnb management services that a vacation rental owner can avail.

• Full-Service Airbnb Management - Full-service management is the whole enchilada. We're talking guest communication, maintenance, cleaning, you name it. With this type of management, you're essentially getting a partner to assist you in handling the nitty and gritty details. In exchange, it'll result in the highest fees.
• Half-Service management - From the name itself, you're essentially sharing the responsibilities with professional managers. They take care of most of the repetitive and time-consuming duties, while you do the rest. This usually includes guest communication, listing optimization, and marketing. It's best for those who just don't have enough time to manage their Airbnb business alone but still want to be hands-on. It's also a great way to make your property better, by bringing in expertise at a lower typical fee of 10%-15% of rental income.
• Part-Time Management: The final management type is part-time. Various Airbnb rentals only get bookings during seasonal periods. There are also others who don't operate year-round. This can be the best option for you. The rates will vary depending on your specific property management agreement, along with the duties and duration you agree upon.

Location

The location also plays a huge role in regard to the rates property managers offer. If it's in a high-demand market then they will definitely be commanding higher fees due to increased competition. It can go up to as high as 45% during specific seasons. One upside is that there'll be plenty of good property managers to choose from due to the higher demand. On the other hand, rentals in low-demand markets can enjoy lower rates, typically maxing out at around 25%. However, one downside is that they may charge higher monthly minimums.

Your property's zip code isn't just about attracting guests – it's a major player in determining how much you'll shell out for professional management. To get the best rates, never accept the first quote. Compare multiple management companies in your area before making a decision.

Property Type and Size

It comes as no surprise that Airbnb management companies and professionals may charge an extra fee for larger and more luxurious properties. These are harder to manage overall and can require more intricate techniques or strategies to pull off.

Think of it like maintaining a sports car versus your typical sedan – more complexity equals more cost. Outdoor spaces, unique amenities, and specialized properties like treehouses, glamping sites, or even RV rentals can push for higher fees.

Understanding how much time and effort it takes to manage the property will be your key guide in pricing negotiations. Condos and one-bedroom apartments are the most basic ones to handle and will have overall lower fees. Townhouses and apartments with about 2 to 4 bedrooms will usually command average rates, while mansions and luxury homes with 5 or more rooms, can require more expensive costs.

Monthly Revenue

During the process of hiring an Airbnb property manager, one of the things that will come up during your negotiations is your monthly revenue. Some managers have a minimum revenue requirement. This is largely due to their earnings being directly tied to the performance of the property.

Low-performing rentals can be harder to manage because of the tighter operational budgets and more work to do in terms of marketing and securing more bookings. In turn, different Airbnb management professionals opt to increase their rates for these cases. Even if they don't, the overall lower revenue can make it feel like the management fees are eating up all of your booking fees.

Experience and Skills

The rates of a professional in the world of short term rental management are just like any other job out there. Those with more experience and better skills command higher salaries than those starting out. Better qualifications often equate to better performance, it's just how things are.

At some point, it just comes down to how much you value a property manager's worth. It's simply like investing in the future of your business. Their insights and strategies can potentially generate significantly more revenue than their management fees cost. They understand the nuances of how to manage your property and have a proven track record to back it up. You know what they say, "you get what you pay for."

Wrapping Things Up

Average Airbnb property management fees can range anywhere from 10% all the way up to 40%. At the end of the day, all of these Airbnb management fees are worth it, if it means the overall improvement of your rental and growth of your business.

If you’re considering starting out your own Airbnb rental or just looking for a new addition to your portfolio, we suggest using an Airbnb calculator like BNBCalc to give you an insight into properties on your radar. It can help you make data-driven decisions based on what active rentals are already earning, allowing you to get an idea of not only revenue but also expenses and paint a fuller picture of your potential investment.