“How much do you charge?” It’s usually the first question property owners ask when considering professional management. And it’s a fair question—but the answer is more nuanced than a simple percentage.
Understanding vacation rental management costs requires looking beyond the headline fee to understand what you’re actually paying for, what’s included versus extra, and most importantly, whether the investment delivers positive returns.
This guide breaks down everything you need to know about vacation rental management fees.
The Standard Fee Structure
Most vacation rental management companies charge between 15% and 35% of gross booking revenue. The industry average sits around 25% for full-service management.
But that range is wide for a reason. Here’s what influences where a company falls on that spectrum:
Factors That Affect Management Fees
Location: Markets with higher property values and nightly rates often have lower percentage fees because the dollar amounts are still substantial. A 20% fee on a $500/night property generates more revenue than 30% on a $150/night property.
Service level: Full-service management (everything handled) costs more than limited service (just booking management, for example).
Property type: Luxury properties, large homes, and unique properties often command premium management fees due to higher guest expectations and more complex operations.
Portfolio size: Some companies offer reduced rates for owners with multiple properties.
Market competition: Areas with many management companies tend to have more competitive pricing.
What’s Typically Included in Management Fees
A reputable full-service management company should include these services in their base fee:
Listing & Marketing
- Professional photography
- Listing creation and optimization
- Multi-platform distribution (Airbnb, VRBO, Booking.com, etc.)
- Direct booking website presence
- SEO and listing updates
Pricing & Revenue
- Dynamic pricing management
- Rate optimization based on demand, events, and seasonality
- Competitive market analysis
- Revenue reporting
Guest Services
- 24/7 guest communication
- Inquiry response and booking management
- Check-in coordination and support
- Issue resolution during stays
- Review management and responses
Operations
- Cleaning coordination and quality control
- Routine maintenance oversight
- Vendor management
- Property inspections
- Restocking coordination
Owner Support
- Monthly financial statements
- Owner portal access
- Tax documentation
- Regular performance reviews
What Usually Costs Extra
Beyond the management fee, expect these additional costs:
Cleaning Fees
Typically $100-$300+ per turnover depending on property size.
Most companies pass cleaning costs directly to guests through the cleaning fee charged at booking. You shouldn’t pay out of pocket for routine turnover cleaning—it should be revenue-neutral or even generate slight margin.
Ask potential managers: “How do you handle cleaning fees, and will I ever pay cleaning costs out of my revenue?”
Maintenance and Repairs
Actual cost of repairs plus possible coordination fee
When things break, you pay for parts and labor. Some companies add a small coordination fee (10-15%) for managing vendors. Others include coordination in their management fee.
Understand the threshold for owner approval. Most managers have authority to handle repairs under $200-300 without calling you, while larger expenses require your sign-off.
Supplies and Restocking
$50-$150/month typical
Toilet paper, paper towels, soap, coffee, and other consumables need regular restocking. Some companies include basic supplies in their fee; others charge separately.
Linen Service
Varies by arrangement
Some properties have linens laundered on-site; others use a linen service. Costs depend on property size and turnover frequency. This may be included in cleaning or charged separately.
Deep Cleaning
$200-$500+ periodically
Beyond regular turnover cleaning, properties need periodic deep cleaning. This is typically scheduled quarterly or semi-annually and costs extra.
Onboarding/Setup Fees
$0-$1,000 one-time
Some companies charge an initial setup fee to cover onboarding, initial photography, listing creation, and property preparation. Others absorb this cost. Ask upfront.
Red Flags in Fee Structures
Watch out for these warning signs when evaluating management companies:
Hidden Fees
If a company can’t provide a clear, written breakdown of all potential charges, walk away. Common hidden fees include:
- Credit card processing fees passed to owners
- “Technology fees” or “platform fees”
- Charges for owner portal access
- Fees for calendar updates or listing changes
- Per-booking administrative fees
Fees on Gross vs. Net
Understand whether the management percentage is calculated on:
- Gross booking revenue (total charged to guest including cleaning)
- Net revenue (after platform fees and cleaning)
Most companies charge on gross. A 25% fee on gross is very different from 25% on net.
Cleaning Fee Markup
Some companies charge guests $200 for cleaning but pay cleaners $100, pocketing the difference in addition to their management fee. This isn’t necessarily wrong if disclosed, but you should know about it.
Long-Term Contracts
Be wary of companies requiring 12+ month commitments with early termination penalties. Quality managers earn your business month to month. A 90-day notice period is reasonable; a $5,000 cancellation fee is not.
The Real Cost Comparison
When evaluating management costs, compare apples to apples. Here’s what self-managing actually costs:
Self-Management Costs
- Your time: 15-25 hours/month (value this honestly)
- Pricing software: $20-100/month
- Channel manager: $20-50/month
- Smart locks/tech: $10-30/month
- Photography: $300-500 (one-time, then updates)
- Learning curve losses: Significant in year one
What You Gain with Professional Management
- Dynamic pricing expertise (often 10-20% revenue improvement)
- Higher search ranking from faster response times
- Consistent 5-star reviews from professional operations
- Direct booking capabilities reducing platform fees
- No 3 AM phone calls or vacation interruptions
Example Comparison
Self-Managed Property:
- Gross bookings: $45,000
- Platform fees (12%): -$5,400
- Software/tools: -$1,200
- Your time (20 hrs/mo × $50/hr × 12): -$12,000
- Net income: $26,400
- True hourly rate for your time: ~$110/hr
Professionally Managed Property:
- Gross bookings: $52,000 (15% higher from optimization)
- Management fee (25%): -$13,000
- Platform fees (10% avg with direct bookings): -$5,200
- Your time (2 hrs/mo × $50/hr × 12): -$1,200
- Net income: $32,600
In this realistic scenario, professional management nets you $6,200 more annually while reclaiming 216 hours of your time.
Questions to Ask About Fees
Before signing with any management company, get clear answers to:
- What is your total management fee percentage?
- Is the fee calculated on gross or net revenue?
- What services are included in that fee?
- What costs extra, and what are typical amounts?
- How do you handle cleaning fees?
- What’s your threshold for repair approvals?
- Are there any setup or onboarding fees?
- What’s your contract length and cancellation policy?
- How and when do you pay owners?
- Can I see a sample owner statement?
How to Evaluate Value, Not Just Cost
The cheapest management company is rarely the best value. Consider:
Revenue Performance: A manager charging 30% who generates $60,000 in bookings nets you more than one charging 20% who generates $40,000.
Occupancy Rate: Ask for average occupancy across their portfolio. Top managers achieve 65-80% in most markets.
Review Scores: Check their listings. Consistent 4.8+ star ratings indicate quality operations.
Owner Retention: How long do owners stay with them? High turnover is a red flag.
Communication Quality: Their responsiveness to you indicates how they’ll treat your guests.
The Bottom Line on Costs
Professional vacation rental management typically costs 20-30% of gross revenue, with cleaning and maintenance as additional pass-through costs. While that percentage might seem high, the best managers more than earn their fee through:
- Higher nightly rates from dynamic pricing
- Better occupancy from optimized listings
- Lower platform fees through direct bookings
- Time savings worth thousands of dollars annually
- Stress reduction that’s hard to quantify but very real
The right question isn’t “how much does management cost?” but “what’s the return on that investment?”
Wondering what professional management would mean for your specific property? Get a free income projection with a transparent breakdown of expected costs and returns.
