{
  "slug": "pm-commission-tier-comparison",
  "title": "Property Manager Commission Tier Comparison Calculator",
  "heading": "PM Commission Tier Comparison Calculator",
  "category": "financial",
  "url": "https://www.revenuelab.fyi/toolbox/pm-commission-tier-comparison",
  "summary": "Compare flat-fee, percentage, and tiered property management pricing structures.",
  "description": "Property managers price their services in several structures — flat monthly fee per door, percentage of collected rent, or a tiered structure that drops the percentage as you add more doors — and the cheapest structure depends entirely on your rent levels and portfolio size. This calculator runs your actual unit count and average rent through three pricing models side by side so you can see which one actually costs less for your specific portfolio instead of assuming percentage-based pricing is always more expensive on higher-rent units, which isn't always true once volume discounts and flat-fee minimums are considered.",
  "formula": "Percentage model = units × avg rent × mgmt% × 12. Flat fee model = units × flat monthly fee × 12. Tiered model = (units within tier 1 × rate1 + units within tier 2 × rate2) × avg rent × 12.",
  "dateModified": "2026-09-30",
  "run_url": "https://www.revenuelab.fyi/api/public/calc?tool=pm-commission-tier-comparison",
  "inputs": [
    {
      "id": "units",
      "label": "Number of units managed",
      "kind": "number",
      "hint": null,
      "default": 15,
      "unit": null,
      "min": 1,
      "max": null
    },
    {
      "id": "avgRent",
      "label": "Average monthly rent",
      "kind": "number",
      "hint": null,
      "default": 1600,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "pctRate",
      "label": "Percentage model rate",
      "kind": "number",
      "hint": null,
      "default": 8,
      "unit": "%",
      "min": 0,
      "max": 20
    },
    {
      "id": "flatFee",
      "label": "Flat fee model, per door per month",
      "kind": "number",
      "hint": null,
      "default": 110,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "tier1Units",
      "label": "Tiered model: units at tier 1 rate",
      "kind": "number",
      "hint": null,
      "default": 10,
      "unit": null,
      "min": 0,
      "max": null
    },
    {
      "id": "tier1Rate",
      "label": "Tier 1 rate",
      "kind": "number",
      "hint": null,
      "default": 9,
      "unit": "%",
      "min": 0,
      "max": 20
    },
    {
      "id": "tier2Rate",
      "label": "Tier 2 rate (units beyond tier 1)",
      "kind": "number",
      "hint": null,
      "default": 6,
      "unit": "%",
      "min": 0,
      "max": 20
    }
  ],
  "outputs": [
    {
      "id": "cheapest",
      "label": "Lowest annual cost",
      "format": "currency",
      "hint": null,
      "primary": true
    },
    {
      "id": "cheapestLabel",
      "label": "Cheapest pricing structure",
      "format": "raw",
      "hint": null,
      "primary": false
    },
    {
      "id": "pctModel",
      "label": "Percentage model annual cost",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "flatModel",
      "label": "Flat fee model annual cost",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "tieredModel",
      "label": "Tiered model annual cost",
      "format": "currency",
      "hint": null,
      "primary": false
    }
  ],
  "worked_example": {
    "inputs": [
      "Number of units managed: 15",
      "Average monthly rent: 1600 $",
      "Percentage model rate: 8 %",
      "Flat fee model, per door per month: 110 $",
      "Tiered model: units at tier 1 rate: 10",
      "Tier 1 rate: 9 %",
      "Tier 2 rate (units beyond tier 1): 6 %"
    ],
    "outputs": [
      "Lowest annual cost: $19,800",
      "Cheapest pricing structure: Flat fee",
      "Percentage model annual cost: $23,040",
      "Flat fee model annual cost: $19,800",
      "Tiered model annual cost: $23,040"
    ]
  },
  "how_to": {
    "title": "How to use this",
    "steps": [
      "Enter number of units managed.",
      "Enter average monthly rent ($).",
      "Enter percentage model rate (%).",
      "Enter flat fee model, per door per month ($).",
      "Enter tiered model: units at tier 1 rate.",
      "Enter tier 1 rate (%).",
      "Enter tier 2 rate (units beyond tier 1) (%).",
      "Read your lowest annual cost on the right — it updates as you type.",
      "Hit Share to keep the scenario or send it to someone."
    ]
  },
  "scenarios": [
    {
      "name": "Conservative",
      "description": "Lower-end numbers — what if things land soft?",
      "values": {
        "units": 9,
        "avgRent": 950,
        "pctRate": 4.8,
        "flatFee": 65,
        "tier1Units": 6,
        "tier1Rate": 5.3999999999999995,
        "tier2Rate": 3.5999999999999996
      }
    },
    {
      "name": "Typical",
      "description": "Defaults — the most common real-world setup.",
      "values": {
        "units": 15,
        "avgRent": 1600,
        "pctRate": 8,
        "flatFee": 110,
        "tier1Units": 10,
        "tier1Rate": 9,
        "tier2Rate": 6
      }
    },
    {
      "name": "Ambitious",
      "description": "Higher-end numbers — what if things really pop?",
      "values": {
        "units": 24,
        "avgRent": 2550,
        "pctRate": 12.8,
        "flatFee": 175,
        "tier1Units": 16,
        "tier1Rate": 14.4,
        "tier2Rate": 9.600000000000001
      }
    }
  ],
  "limitations": [
    "Results are estimates before tax, fees, and inflation unless an input explicitly covers them.",
    "Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.",
    "This is educational maths, not financial advice. Check anything contractual with the lender or your accountant."
  ],
  "faq": [
    {
      "q": "Which pricing model is usually cheapest?",
      "a": "Flat fee tends to win at higher rent levels since the fee doesn't scale with rent, while percentage-based pricing tends to win at lower rent levels. Tiered pricing usually lands in between and rewards larger portfolios, so the right answer depends entirely on your specific rent and unit count, not a universal rule."
    },
    {
      "q": "Should I negotiate a tiered structure as my portfolio grows?",
      "a": "Yes — most managers will discuss volume discounts once you're above 10-15 doors with one company, since the marginal cost of managing an additional unit within an existing route or system is lower than the average cost of the first unit. Ask directly; discounted tiers are rarely offered proactively."
    },
    {
      "q": "Does a lower percentage always mean a better deal?",
      "a": "No — check what's excluded. Some managers advertise a low percentage but charge separately for leasing, renewals, inspections, and maintenance coordination markups that add up to more than a slightly higher all-inclusive percentage from a competitor. Compare total annual cost, not the headline rate."
    },
    {
      "q": "Is flat-fee pricing riskier for the manager or the owner?",
      "a": "It shifts more downside to the manager on vacant or low-rent units (they collect the same flat fee whether or not the unit is occupied, so alignment on filling vacancies fast can weaken), while percentage pricing means the manager makes more only when rent is actually collected, which usually aligns incentives better around occupancy and rent growth."
    }
  ],
  "related": [
    "https://www.revenuelab.fyi/toolbox/pm-fee-vs-self-manage",
    "https://www.revenuelab.fyi/toolbox/portfolio-door-scaling-breakeven"
  ],
  "license": "CC-BY-4.0",
  "citation": "RevenueLab — Property Manager Commission Tier Comparison Calculator (https://www.revenuelab.fyi/toolbox/pm-commission-tier-comparison)"
}