Rent is higher than ever. A one-bedroom apartment on average cost $1,769 last year, increasing over the previous year by 39%. Looking at current figures, that number only continues to rise.
For a property management company, it's important to know how all these costs are affecting the end user. People often decide whether or not to rent a place based on cost alone. So how much should a landlord in Bedford, Texas charge for application fees?
Join us as we discuss the average application fees during the tenant screening process.
What Are Application Fees for?
The first question you might ask property managers is why there is an application fee. After all, there's no guarantee that someone who pays the fee will get the apartment they want. Plus, rising prices and limited availability are causing some people to stop applying because of the cost of these fees.
First, this fee helps to pay for management services. It takes man hours to process all of these applications, which isn't something you can do for free.
Second, it helps to recoup the costs of tenant screening. Most landlords and management services perform background checks on prospective tenants. Obviously, these background checks are not free, so they pass the cost on to the applicant.
Third, it takes a lot of work to advertise a place. Marketing and listing costs can easily weigh down your budget. So, application fees may help pay for effective marketing efforts.
What Are Typical Application Fees?
Many states have laws determining how high fees can be, or if you can charge them at all. In Bedford, Texas, and the rest of the state, there is no cap on how much you can charge. In theory, you can charge as much as you want.
That said, it would be bad business sense to charge an exorbitant amount. Most landlords set their fees at $15-50.
Again, most people are applying for multiple apartments at the same time. It would be economically prohibitive to spend much more than that on a dozen different applications.
What Affects Application Fee Costs?
The average cost depends on the location, the type of housing, and the desirability of the housing. Big apartment complexes that require outsourcing tasks will usually be more expensive. They have a lot of applicants, and thus, a lot of administrative tasks and expenses.
Smaller operations, such as a single landlord, usually involve limited or no application fees. Since there is no property management company to pay, operating costs are lower.
Find a Property Management Company in Bedford, Texas
A property management company charges application fees as a means to cover its operating costs and pay for tenant screening. In Bedford, Texas, there is no limitation on how much a landlord can charge for a rental application. That said, it's in the landlord's best interest to charge a reasonable amount due to high housing costs and low availability.
PMI Metroplex Properties in Bedford, Texas provides full-service property management. We use state-of-the-art technology and offer world-class customer service. Determine your potential ROI with our free rental analysis.