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Renting by Owner vs Property Management Fees

June 30, 2018


What is Renting by Owner?


Thousands of owners across the Algarve choose to Rent by Owner. This is where the owner takes on some of the management duties involved in renting out their holiday home, whilst letting a property manager take care of things on the ground.





The main reason why so many owners choose to rent directly is to cut down on often unnecessary expenses.


Years ago, such a decision would have been much more complicated. However, thanks to the internet, you can now easily list your property online and manage your own bookings through a number of specialist holiday rental websites.


Compared to advertising through a property management company, you can expect higher levels of exposure to millions of motivated potential renters around the world - whilst keeping your expenses to a minimum.


Besides the cost benefits, there are also other advantages of renting by owner - most importantly:


  • You get to decide who stays in your holiday home;

  • You have full control over how and where your property is advertised;

  • You can ensure your guests receive a high standard of service: from initial enquiries through to post-stay feedback, you can offer a more personalised service, leading to happy customers and those all important repeat bookings. 



Is Renting by Owner for me?


Providing you like to be in control and have enough time set aside, managing your property is surprisingly easy - and you can decide how much or little you want to get involved.


Typical owner responsibilities include advertising online and taking bookings. The other day to day tasks (that can’t be completed via phone or email) can be handed over to a property management company or trusted housekeeper; their duties may include key handling, cleaning, laundry, keeping an eye out for necessary maintenance work and dealing with guest requests and complaints.



Comparing the costs


1. Property Management


If you hire a property management company full-time, you can expect to pay 15-50% commission per booking. Those charging high rates are likely to include extra services (such as cleaning and laundry) at no additional cost; low rates will usually mean that extra services are charged separately.


Your Property Manager will be responsible for all aspects of renting out your holiday home - from advertising and screening guests, taking bookings, hiring service providers (such as cleaning and laundry) and dealing with maintenance issues.


Property management fees are deducted automatically from each booking and your Property Manager may also keep a cash reserve, held in a client account, to pay for any additional expenses on your behalf (there is usually a cap on the amount your Property Manager can spend before your prior authorisation is required).


Contracts are generally for a minimum 12-month period and your level of involvement will be kept to a minimum, allowing you to sit back and relax, knowing everything is taken care of for you.



2. Renting by Owner


By taking over the admin side of your holiday rental business, you can reduce your costs and have more control over what goes on in your holiday home - but keep in mind that many successful holiday rental owners spend on average 9 hours a week perfecting their trade.


Advertising and Managing Bookings


If you list your property on a holiday rental website, you can expect to pay 3 -5 % commission on every confirmed booking OR a fixed annual fee. The most popular sites also charge a payment processing fee, ( and Owners Direct – part of the HomeAway group).

For this you get access to everything you need to successfully manage your holiday home remotely, including:


  • Free listing with pictures;

  • Secure client homepage to manage all enquiries, bookings and guest communications;

  • A mobile app for when you’re on the go;

  • Secure payment processing;

  • Verified guest reviews.


Additional perks often include:


  • Free automatic listings on partner websites;

  • Free professional photography;

  • Free additional insurance cover for accidental damage or loss of property;

  • If you pay on a commission basis, you can usually opt out any time.


On-site Duties


Although Renting by Owner helps to avoid relying too heavily on outside sources, you will still need to enlist the help of a property management company between bookings to ensure your property is ready for your next guests.


In this instance, unlike the high commission based fees of an all-inclusive property management service, you should expect to pay a fixed monthly rate for Key Holding, plus extra for any services you use.


Prices start from as little as €14 per month and contracts are usually 12 months. Your property management company may also include some basic services as standard, such as a 24 Hour Emergency Helpline, Mail Uplift/Forwarding Service and regular Security Checks for added peace of mind.


To learn more about useful property management services we offer here at Apart Management that could help you with Renting by Owner, click here.




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Apart Management

Registered Tax no: 281819580

Rua Bartolomeu Dias 

Lote 20A, 33 

Albufeira, 8200 096


Tel: (00351) 927 212 573


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