Understanding management fees and costs

Highlands Property | October 2026

Property management fees pay for the agreed services involved in managing your rental property. Some charges are ongoing, while others apply when a new tenant is found or extra work is needed. Understanding the full fee schedule helps you budget and compare agencies fairly.

What does the management fee cover

The management fee pays for the ongoing service set out in your agreement. This may include collecting rent, keeping payment records, communicating with tenants, coordinating repairs and organising routine inspections. Ask which tasks are included and whether any attract a separate charge.

A management fee is often expressed as a percentage of rent. Confirm what rent amount it is calculated on, whether it applies only to rent collected and whether the quoted rate includes GST.

How is a letting fee different

A letting fee is a separate charge associated with finding and placing a new tenant. Depending on the agency’s service, this may cover inspections, application checks and arranging the start of the tenancy.

It may be expressed as an amount based on weekly rent or as a fixed fee. Ask when it is payable and whether advertising or lease preparation is included. These costs may be charged separately.

Are there lease preparation or renewal fees

Some agencies charge owners for preparing a tenancy agreement or arranging a lease renewal. Others include these tasks in their service. Ask which fees apply to a new tenancy and which apply when an existing tenant renews.

These are charges to the property owner under the management agreement. In NSW, tenants cannot be charged for preparing or filling in their tenancy agreement.

What should I know about marketing costs

Marketing costs may include photography, property listings, signs, floorplans or video. An agency may offer a standard package and optional upgrades. Ask what is included, how long the advertising runs and whether further costs could apply if another campaign is needed.

Discuss the purpose of each upgrade before approving it. The aim is to present your property clearly to suitable applicants. A larger package is not automatically the right choice for every home.

What other agency fees might apply

Depending on the agreement, there may be administration charges or fees for tribunal preparation and attendance. Work outside the usual management service, such as coordinating a renovation or assisting with an insurance claim, may also cost extra. 

Ask whether these charges are fixed or hourly, whether a minimum charge applies and how expenses are handled. Clarify how extra work is approved before it starts and request an estimate where practical.

Are repairs and property bills included

Generally, the agency fee pays for the agreed management work. The cost of a tradesperson, replacement appliance or other repair is a separate property expense. Insurance, council rates and strata levies, where applicable, also need to be considered in your budget.

Ask how repair spending is authorised and when the manager will contact you. Make sure the process allows for urgent repairs and that you understand any separate coordination charges.

How do I compare the overall cost

Request a written fee schedule and check it against the management agreement. Compare the same services across agencies, including GST and any separate charges. A lower management percentage may not mean a lower total cost.

Ask each agency to explain the likely charges for a year with an existing tenant and a year that involves finding a new one. Allow separately for vacancy periods and property expenses. These are budget estimates, not guaranteed totals.

How will I see what has been charged

Ask how fees and authorised expenses appear on your owner statement and when rental funds are paid to you. Check deductions against your agreement and approved work. If a charge is unclear, ask for an explanation.

At Highlands Property, our portfolio management team can explain our services and current fees so you understand the costs before deciding. Speak with our local team about a management plan that suits your investment.