The Michigan State Housing Development Authority (MSHDA) and the U.S. Department of Agriculture’s Office of Rural Development (RD) recently released the allowable multifamily property management fees for 2017.
MSHDA
The maximum fees allowed by MSHDA for the 2017 calendar year are as follows:
- Management fee per unit – $508
- Premium management fee per unit – $78
This is almost a 1% increase from the calendar year 2016 maximum fees of $504 for the management fee per unit and $77 for the premium management fee per unit.
See MSHDA’s 2017 Annual Budget Guide Policy.
Rural Development
RD management fees vary from state to state based on the increase of HUD’s Operating Cost Adjustment Factor.
The fees in effect for 2017 can be found here.
Highlights for Michigan include an approximate 4% increase from the 2016 fee of $47 to $49 per occupied unit per month beginning in 2017.
HUD
Multifamily projects subject to the U.S. Department of Housing and Urban Development (HUD) should review the guidelines in The Management Agent Handbook (4381.5) for requirements in determining allowable fee amounts to be paid with project funds.
HUD management fees are typically calculated using a fee per unit, per month calculation that is converted to a percent of the total rental income of a property. Management fee agreements may be open-ended or define a set time period, such as three years.
For more information, please contact your Yeo & Yeo advisor.