What Is Real Estate Management?

By Kristi Waterworth – Updated Apr 6, 2026 at 10:24 AM EST | Fact-checked by Margo Winton Parodi

Key Points

Real estate management handles all landlord duties, making it ideal for passive investors.
Management fees range generally from 5% to 10% of rent, and can be less the more units you have.
Choose a reputable management company by vetting options through your networks and interviews.

As your real estate business grows, you may find yourself needing an extra hand to manage the laundry list of tasks associated with being a landlord. You could hire an on-site property manager for yourself or potentially have a tenant oversee the running of the property, but both can have complications.

Hiring a third-party real estate management company can reduce your overhead and be a stress-free approach to passive income from your investment, but it does come at a cost. Here's what real estate management can offer and what you should expect if you decide to hire property management.

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Two managers at work in a business office. — Image source: Getty Images.

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What is real estate management?

Real estate management is utilized for any type of rental property, including residential rentals and commercial real estate. The management company helps manage the daily operations of the rental property or portfolio of properties on behalf of the landlord. The manager oversees rental operations as well as the upkeep of the property and coordinates the buying and selling of a property with a real estate agent.

A professional property manager will manage all aspects of their clients' properties, from screening prospective tenants to collecting rent. They handle all the maintenance requests from the tenant and will hire the appropriate service to repair any issues. A property management company will even take care of evictions and filing any paperwork associated with it or other government programs. Think of real estate property management as a one-stop shop for all of your landlord needs.

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What to expect from property management

The cost of real estate management will vary by location and the number of units you have, but you can expect to pay the property manager between 5% and 10% of the rent collected from your properties. In general, the more units you have, the less they will charge. Regardless, depending on the market and how you are sitting on the deal, 5% to 10% can take a good portion of your profits.

Finding a quality real estate management company is key. If you decide to spend the money, ensure you're hiring a qualified property management firm.

If you're part of an investing network, ask around for recommendations. Do a little research online to cross-check reviews, and ask your broker or real estate agent if they offer property management services or have a management company to recommend. You will also want to interview several professionals to make sure they're a good fit for your business model and get any questions answered before making your final decision.

The bottom line

As a real estate investor, balancing your time and cash flow is important. If your business model includes rental property, you'll likely need to consider real estate management at some point.

Property management can take a huge load off your shoulders but isn't cheap, so run the numbers to decide if your time is worth the cost. It may not make sense right away, but as your real estate business grows, you may want to reconsider asset management along the way since the fees decrease with an increasing number of units.

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About the Author

Kristi Waterworth has been a contributing real estate and financial expert at The Motley Fool, covering real estate, investing, and personal finance topics, since 2020. Kristi has been interviewed by various TV media outlets and podcasts for her real estate investing expertise – from residential real estate to digital real estate and everything in between. Kristi’s journalist career spans over 25 years, and she has written about real estate investing, homeownership, and home construction specifically for the last decade. She was also previously a licensed Realtor and general building contractor before the Great Recession and housing market collapse. She holds a bachelor’s degree in American history from Columbia College in Missouri.

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