“How much does it really cost to fix that?”
“Why is this invoice $200 more than the estimate?”
“Are they marking up contractor fees?”
If you’ve ever asked these questions about your property manager, you’re not alone.
Here’s the uncomfortable truth:
Most property management companies make money by marking up maintenance costs, hiding contractor fees, and charging you more than they actually paid. The result?
- You pay $500 for a $300 repair
- You’re charged “administrative fees” on top of contractor costs
- You never know if you’re getting a fair price
- Trust erodes with every inflated invoice
After 19 years managing 250 properties in the Lansing area, I’ve seen every pricing trick in the book.
And I’ve built my business on the opposite principle:
“Our cost is your cost.”
No markups. No hidden fees. No games.
When we pay $300 for a repair, you pay $300. When a contractor charges us $150, you’re charged $150.
Period.
In this post, I’ll show you: – What “our cost is your cost” really means – Why most companies won’t do it – How much money it saves you (real numbers) – How to verify your property manager is being honest Let’s talk about transparency.
What “Our Cost Is Your Cost” Actually Means
It’s simple:
You pay exactly what we pay. No markups. No hidden fees. No surprises.
Here’s How It Works:
Scenario 1: In-House Maintenance The repair: Leaky faucet, needs new cartridge and seal Our cost: – Labor: $75 (1 hour at $75/hour) – Parts: $35 (cartridge + seal) – Total: $110 What you’re charged: $110 What most companies charge: $175-$225 (50-100% markup on parts, inflated labor rates) Your savings: $65-$115 per repair
Scenario 2: Outside Contractor The repair: HVAC unit needs new capacitor Contractor invoice to us: $285 What you’re charged: $285 What most companies charge: $350-$400 (20-40% markup + “coordination fee”) Your savings: $65-$115 per contractor visit
Scenario 3: Emergency Repair The repair: Burst pipe at 2 AM, emergency plumber needed Plumber invoice to us: $450 (emergency rate) What you’re charged: $450 What most companies charge: $550-$650 (markup + “emergency coordination fee”) Your savings: $100-$200 per emergency
Scenario 4: Major Project The project: Full kitchen remodel after tenant move-out Contractor invoice to us: $8,500 What you’re charged: $8,500 What most companies charge: $10,200-$11,900 (20-40% markup on large projects) Your savings: $1,700-$3,400 per major project
What’s Included in “Our Cost”?
Our cost includes: – Actual labor hours at our standard rate ($75/hour for handyman work) – Actual parts/materials at our cost (no markup) – Actual contractor invoices (no markup) – Sales tax (we pay what the vendor charges) Our cost does NOT include: – Markups on parts or materials – “Coordination fees” or “administrative fees” – Inflated labor rates – Hidden charges The only fee you pay: Our 10% management fee (or $100/month minimum). That’s it.
Why Most Property Management Companies Won’t Do This
If “our cost is your cost” saves property owners thousands, why doesn’t everyone do it?
Because marking up maintenance is how most property management companies make their real money.
The Industry Secret: Management Fees Are Just the Beginning
Here’s how most property management companies actually make money: Revenue Stream #1: Management Fees (The Visible Income) – 8-10% of monthly rent – Example: $1,500 rent × 10% = $150/month Revenue Stream #2: Maintenance Markups (The Hidden Income) – 20-50% markup on parts – 15-40% markup on contractor services – “Coordination fees” of $25-$100 per work order – “Administrative fees” of 10-20% on large projects
Let’s do the math:
Property A: $1,500/month rent, 3 maintenance requests/month Visible income (management fee): – $1,500 × 10% = $150/month Hidden income (maintenance markups): – Work order 1: $200 repair, 30% markup = $60 profit – Work order 2: $350 contractor, 25% markup = $87.50 profit – Work order 3: $150 repair, 40% markup = $60 profit – Total hidden profit: $207.50/month
Total monthly income from one property: – Visible: $150 – Hidden: $207.50 – Total: $357.50 The reality: They’re making 58% of their income from maintenance markups, not management fees.
And you have no idea.
Why They Can Get Away With It
Reason #1: You don’t see the original invoices Most property managers send you a summary invoice: – “Plumbing repair: $450” “HVAC service: $325”
You never see: – What the plumber actually charged them ($285) – What the HVAC company actually charged them ($210)
Result: You assume their invoice is the actual cost.
Reason #2: You can’t easily verify pricing You call the plumber: “How much did you charge for the repair at 123 Main St?”
Plumber: “I can’t discuss pricing with you. You’ll need to talk to your property manager.” Result: You’re stuck trusting your property manager’s word.
Reason #3: It’s buried in the contract Buried in Section 8, Paragraph 4 of the 12-page contract:
“Manager may charge reasonable fees for coordination and administration of maintenance services.”
Translation: “We can mark up whatever we want, and you agreed to it.”
Result: It’s technically legal, even if it’s unethical.
Reason #4: Industry standard = “everyone does it” Property manager’s defense: “All property management companies mark up maintenance. It’s industry standard.”
Translation: “Everyone’s doing it, so it must be okay.”
Result: Property owners assume it’s normal and accept it.
Why We Don’t Do It
Simple: Because it’s wrong.
Our philosophy:
You hired us to manage your property, not to profit from your repairs.
You pay us 10% to: – Find and screen tenants – Collect rent – Coordinate maintenance – Handle emergencies – Manage leases – Conduct inspections That 10% covers our time, expertise, and systems.
We don’t need to mark up your maintenance to make a profit.
We make our money by managing properties well, not by inflating invoices.
The result: – You save thousands per year – You trust us completely – You stay with us longer (80%+ retention over 7 years) – You refer other property owners Transparency isn’t just ethical. It’s good business.
How Much Money Does “Our Cost Is Your Cost” Actually Save You?
Let’s run the numbers on a typical property.
Property Profile:
- Monthly rent: $1,500
- Management fee: 10% ($150/month)
- Average maintenance requests: 4/month (52/year)
- Average maintenance cost: $250/request
Scenario A: Traditional Property Manager (With Markups)
Annual management fees: – $150/month × 12 = $1,800 Annual maintenance costs (with 30% average markup): – 52 requests × $250 = $13,000 actual cost – $13,000 × 1.30 (30% markup) = $16,900 charged to you – Hidden markup profit: $3,900
Total annual cost to you: – Management fees: $1,800 – Maintenance (marked up): $16,900 – Total: $18,700
Scenario B: Simply Live (“Our Cost Is Your Cost”)
Annual management fees: – $150/month × 12 = $1,800 Annual maintenance costs (no markup): – 52 requests × $250 = $13,000 actual cost You’re charged: $13,000
Total annual cost to you: – Management fees: $1,800 – Maintenance (actual cost): $13,000 – Total: $14,800
Your Annual Savings: $3,900
That’s $325/month you’re keeping in your pocket instead of paying in hidden markups.
Over 5 years: $19,500 saved Over 10 years: $39,000 saved Over the 19 years we’ve been in business: $74,100 saved per property
Real Example: One of Our Clients
Client profile: – 5 rental properties – Average rent: $1,400/property – Average maintenance: $15,000/year across all properties
Before Simply Live (previous property manager with markups): – Management fees: $8,400/year (10% of $84,000 annual rent) – Maintenance costs: $19,500/year (30% markup on $15,000 actual cost) – Total annual cost: $27,900
With Simply Live (no markups): – Management fees: $8,400/year (same 10%) Maintenance costs: $15,000/year (actual cost, no markup) – Total annual cost: $23,400
Annual savings: $4,500 Over 7 years with us: $31,500 saved Client’s words: “I thought I was getting a good deal with my previous manager because their management fee was 8%. Then I realized I was paying 30% more on every repair. Simply Live’s 10% fee with no markups saves me thousands every year.”
How to Verify Your Property Manager Is Being Honest
If you’re currently using a property manager, here’s how to check if they’re marking up maintenance:
Test #1: Request Original Invoices
What to do: Next time you receive a maintenance invoice, reply:
“Thanks for the invoice. Can you please send me a copy of the original contractor invoice for my records?”
What to watch for:
Honest property manager response: – “Sure, here’s the contractor’s invoice. You’ll see we charged you exactly what they charged us.” – Sends PDF of actual contractor invoice matching your charge Dishonest property manager response: – “We don’t provide contractor invoices to owners.” – “That’s proprietary information.” – “Our invoice is all you need for your records.” – Sends a summary, not the actual contractor invoice Red flag: If they won’t show you the original invoice, they’re probably marking it up.
Test #2: Call the Contractor Directly
What to do: Find the contractor’s name on your invoice, Google their number, and call: “Hi, I’m the property owner at 123 Main St. Can you tell me what you charged for the repair on [date]?” What to watch for:
If the contractor says: – “$285” and your invoice shows $285 → No markup, honest property manager – “$285” and your invoice shows $370 → 30% markup, dishonest property manager – “I can’t discuss that with you” → Contractor is protecting the property manager’s markup Red flag: If the numbers don’t match, you’re being marked up.
Test #3: Compare to Market Rates
What to do: Get 2-3 quotes for the same type of repair from local contractors. Example:
Your property manager charges: $450 for HVAC capacitor replacement You call 3 HVAC companies: – Company A: $275 – Company B: $295 – Company C: $310 Average market rate: $293 Your property manager’s charge: $450 Markup: 54% Red flag: If your property manager’s charges are consistently 20-50% higher than market rates, they’re marking up.
Test #4: Review Your Annual Maintenance Costs
What to do: Calculate your annual maintenance cost per property.
Industry averages: – Typical annual maintenance: 1-2% of property value Example: $200,000 property = $2,000-$4,000/year in maintenance
Your annual maintenance: $8,500/year on a $200,000 property (4.25%) Red flag: If your maintenance costs are 2-3x industry average, your property manager is either incompetent (doing unnecessary repairs) or dishonest (marking up costs).
Test #5: Ask About Their Markup Policy
What to do: Call your property manager and ask directly:
“Do you mark up maintenance costs, or do you charge me exactly what you pay contractors?”
What to watch for:
Honest property manager response: – “We charge you exactly what we pay. No markups.” – “We make our money from the management fee, not maintenance markups.”
Dishonest property manager response: – “We charge reasonable coordination fees for our time.” – “There may be small administrative fees on some work orders.” – “Our pricing is competitive with industry standards.”
Translation of dishonest responses: – “Coordination fees” = markups – “Small administrative fees” = markups – “Competitive with industry standards” = everyone marks up, so we do too
Red flag: If they won’t say “no markups,” they’re marking up.
What Transparency Actually Looks Like
Here’s what you get with “our cost is your cost”:
1. Original Contractor Invoices
Every time we use an outside contractor, you receive: – Our summary invoice (what you owe) – The contractor’s original invoice (proof of actual cost) – Both invoices match exactly
Example:
Contractor invoice (attached): – ABC Plumbing – Date: 10/15/2024 – Service: Replace water heater – Cost: $1,250
Our invoice to you: – Simply Live LLC – Date: 10/15/2024 – Service: Replace water heater (ABC Plumbing) – Cost: $1,250 – Attached: ABC Plumbing invoice
You see exactly what we paid. No surprises.
- Itemized In-House Maintenance
Every time we do in-house maintenance, you receive: – Labor hours and rate ($75/ hour) – Parts/materials with receipts – Total cost breakdown
Example:
Our invoice: – Date: 10/20/2024 – Service: Replace kitchen faucet – Labor: 1.5 hours × $75/hour = $112.50 – Parts: Faucet ($89), supply lines ($12), plumber’s putty ($6) = $107 – Total: $219.50 – Attached: Home Depot receipt for parts
You see exactly what we paid for parts and how long it took. No padding.
- Pre-Approval for Large Expenses
For any repair over $500, we: – Get 2-3 contractor quotes – Send you all quotes (not just the one we recommend) – Explain our recommendation – Get your approval before proceeding
Example:
Email to you:
“Hi [Owner], The HVAC unit at 123 Main St needs a new compressor. Here are three quotes: • ABC Heating & Cooling: $2,850 (recommended – we’ve used them for 10 years, excellent work, 2-year warranty)
- XYZ HVAC: $2,650 (lower price, but only 90-day warranty, mixed reviews)
- Local Comfort: $3,200 (highest price, same warranty as ABC)
We recommend ABC for the quality and warranty. Please let us know if you’d like us to proceed, or if you’d prefer one of the other options.
All three contractor quotes are attached for your review.”
You see all options and make the final decision. No hidden agenda.
- Monthly Financial Reports
Every month, you receive: – Rent collected – Management fee charged (10%) Maintenance costs (itemized, with receipts/invoices attached) – Net profit/loss for the month
Example:
October 2024 Financial Report – 123 Main St Income: – Rent collected: $1,500 Expenses: – Management fee (10%): $150 – Maintenance – Faucet repair (10/5): $110 (invoice attached) – Maintenance – HVAC service (10/12): $285 (invoice attached) Maintenance – Gutter cleaning (10/20): $95 (invoice attached) – Total expenses: $640
Net income: $860 You see every dollar in and out. Complete transparency.
The Hidden Benefits of Transparent Pricing
“Our cost is your cost” doesn’t just save you money. It changes the entire relationship.
Benefit #1: Complete Trust
Traditional property manager: – You wonder if every invoice is inflated – You second-guess every repair recommendation – You feel like you’re being taken advantage of Trust erodes over time
Transparent property manager: – You know you’re paying actual cost – You trust repair recommendations (no financial incentive to over-repair) – You feel like partners, not adversaries – Trust grows over time
Result: 80%+ of our clients stay with us for 7+ years. Industry average is 2-3 years.
Benefit #2: Better Maintenance Decisions
Traditional property manager: – Their incentive: Recommend repairs that generate markup profit – Example: “You need a new water heater” (when a $150 repair would work) – Why: $1,500 water heater × 30% markup = $450 profit vs. $150 repair × 30% markup = $45 profit
Transparent property manager: – Our incentive: Recommend the most cost-effective solution (we don’t profit either way) – Example: “The water heater element is bad. We can replace it for $150, which should give you another 2-3 years.” – Why: We make the same 10% management fee whether you spend $150 or $1,500
Result: You get honest recommendations based on what’s best for your property, not what’s most profitable for us.
Benefit #3: Predictable Costs
Traditional property manager: – You never know if you’re paying fair market rates Every invoice is a surprise – You can’t budget accurately
Transparent property manager: – You know you’re paying market rates (you can verify with original invoices) – No surprise markups – You can budget based on actual maintenance costs
Result: Better financial planning and fewer unpleasant surprises.
Benefit #4: Referrals and Growth
Traditional property manager: – Clients leave after 2-3 years when they discover markups – Negative reviews about “hidden fees” – Growth comes from constant new client acquisition
Transparent property manager: – Clients stay 7+ years (80%+ retention) – Clients refer friends and family – Growth comes from referrals, not advertising
Our results: – 95% of new clients come from referrals – 4.9-star Google rating – Voted Best Property Management Company in Lansing (2025)
Result: Transparency isn’t just ethical. It’s the foundation of sustainable growth.
Common Questions About “Our Cost Is Your Cost”
Q1: “If you don’t mark up maintenance, how do you make money?”
A: We make money from our 10% management fee (or $100/month minimum). That fee covers: – Finding and screening tenants – Collecting rent – Coordinating maintenance – Handling emergencies – Managing leases – Conducting inspections Financial reporting
We don’t need to mark up maintenance to be profitable. We just need to manage properties well.
The math: – 158 properties × $100/month average = $15,800/month revenue – That’s $189,600/year from management fees alone – We don’t need maintenance markups to run a successful business
Q2: “Don’t you deserve to be paid for coordinating contractors?”
A: Yes, and we are. That’s what the 10% management fee covers.
Coordinating maintenance is part of property management. It’s included in our fee.
We don’t charge separately for: – Taking tenant maintenance calls – Scheduling contractors – Getting quotes – Overseeing repairs – Following up on quality That’s all included in the 10%. No additional “coordination fees.”
Q3: “What if the contractor gives you a discount? Do you pass that on?”
A: Yes. 100%.
Example:
Contractor’s normal rate: $350 for HVAC service Contractor’s rate to us (volume discount): $285 What you’re charged: $285 (the discounted rate) We pass on every discount we receive.
Why? Because “our cost is your cost” means our actual cost, including discounts.
Q4: “What about emergency repairs? Do you mark those up?”
A: No. Never.
Emergency repairs are already expensive (contractors charge 1.5-2x for after-hours service).
You shouldn’t pay even more because of our markup.
Example:
Normal plumbing repair: $200 Emergency plumbing repair (2 AM): $400 (contractor’s emergency rate) What you’re charged: $400 (actual cost) What most companies charge: $500-$550 (markup on top of emergency rate) You’re already paying a premium for emergency service. We don’t pile on.
Q5: “How do I know you’re not just inflating your labor rates?”
A: Our labor rate is $75/hour for handyman work. That’s been our rate for 5 years. You can verify it’s fair by: – Calling local handymen (most charge $75-$95/hour in Lansing) – Checking our invoices over time (rate is consistent) – Comparing to HomeAdvisor/Angi average rates for our area
We also itemize every job: – Hours worked – Tasks completed – Parts used You see exactly what we did and how long it took. No padding hours.
Q6: “What if I want to use my own contractor?”
A: You’re welcome to.
Some owners have contractors they trust and want to use. We’re fine with that. How it works: – You provide your contractor’s contact info – We coordinate with them for repairs – They bill you directly (or bill us and we pass through the invoice) – You pay exactly what they charge
No markup. No coordination fee. No problem.
The Bottom Line: Transparency Builds Long-Term Relationships
After 19 years in property management, here’s what I’ve learned:
Short-term thinking: Mark up maintenance, maximize profit per transaction, clients leave after 2-3 years
Long-term thinking: Transparent pricing, build trust, clients stay 7+ years and refer others
We chose long-term.
The results: – 80%+ client retention over 7 years – 95% of new clients from referrals 4.9-star Google rating – Voted Best Property Management Company in Lansing – $3,900 average annual savings per property for our clients
“Our cost is your cost” isn’t just a pricing policy. It’s a philosophy: – We work for you, not against you – We’re partners in protecting your investment – We make money by managing properties well, not by inflating invoices Transparency builds trust, and trust builds long-term relationships
That’s how we’ve grown to 158 properties over 19 years. Not by marking up maintenance.
By being honest.
Ready to Stop Paying Hidden Markups?
If you’re tired of wondering whether your property manager is being honest with you, let’s talk.
Free 20-minute consultation: We’ll review your current maintenance costs and show you how much you could save with transparent pricing.
What you’ll get: – Original contractor invoices (every time) – Itemized in-house maintenance (with receipts) – Pre-approval on large expenses (with multiple quotes) Monthly financial reports (complete transparency)
We serve rental property owners in the Lansing tri-county area. Our cost is your cost. No markups. No hidden fees. No games. Just honest property management.
Simply Live LLC | Lansing Tri-County Property ManagementPhone: [ (517) 258-0349] | Serving rental property owners in Michigan’s tri-county area for 19 years
“Our cost is your cost. That’s not just our pricing policy. It’s our promise.”
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