Real Estate Math
A property manager in Illinois charges 8% of collected rents. If monthly rents collected are $12,500, what is the annual management fee?
A$1,000
B$12,000✓ Correct
C$12,500
D$15,000
Explanation
Monthly management fee = $12,500 × 0.08 = $1,000. Annual management fee = $1,000 × 12 = $12,000. Property management fees in Illinois typically range from 6% to 12% of collected rents for residential properties and vary for commercial properties. The fee is based on collected rents, not scheduled rents, meaning vacancies reduce the management fee.
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