Yes, property managers do find tenants, and for most companies it’s one of the core services they offer. The work runs from listing the vacancy through handing over the keys: marketing, showings, screening, lease preparation, disclosures, deposit collection, and the move-in inspection. Expect to pay a one-time placement fee of 50 to 100 percent of the first month’s rent for that service, separate from any ongoing monthly management fee.
What Tenant Placement Includes
Placement starts with getting the unit in front of qualified renters. Managers typically hire a photographer, write a listing that covers square footage, included utilities, pet policy, and nearby amenities, and push the listing across the major rental platforms, the MLS, and their own company site. Physical signage still helps for units in walkable neighborhoods, where a yard sign catches people already looking in the area.
Once inquiries come in, experienced managers pre-screen before scheduling any tours. A short call or email exchange covers move-in date, number of occupants, pets, income, and whether the applicant will consent to a credit and background check. That filter keeps the showing calendar focused on people who can actually qualify.
Showings themselves happen a few ways. Guided tours give the manager a chance to answer questions and read the applicant’s interest. Open houses work for high-demand units where dozens of individual appointments aren’t practical. Some managers also use lockbox systems that generate a one-time access code for verified applicants, letting them self-tour without anyone present.
Tenant Screening: Where the Fee Earns Itself
Screening is the part of placement that most protects the owner. A thorough process pulls credit reports, criminal records, eviction history, and employment verification, and includes calls to previous landlords about payment history, lease compliance, and unit condition at move-out.
What a Background Check Covers
A standard tenant background check reviews credit card and loan account status, payment history, prior evictions, criminal conviction records, and whether the applicant has filed for bankruptcy or been involved in housing-related lawsuits.1Federal Trade Commission. Tenant Background Checks and Your Rights Some screening companies also generate a proprietary risk score meant to predict whether an applicant will pay rent on time.2Consumer Financial Protection Bureau. Review Your Rental Background Check
Income verification has gotten more rigorous. Rather than accept pay stubs at face value, many managers now use third-party payroll databases to confirm employment and salary independently, which catches fabricated or outdated documentation. The common benchmark is monthly income of at least three times the rent, though some markets push that higher.
Criminal History Has Legal Limits
Managers cannot blanket-reject anyone with a criminal record. HUD guidance issued in 2016 made clear that screening policies based solely on arrest records are likely discriminatory because they disproportionately affect minority applicants. Even conviction-based policies must be narrowly tailored: screening only for offenses that pose a genuine threat to property or residents, applying a reasonable lookback of seven to ten years, and giving applicants a chance to explain their circumstances before a final decision.
Adverse Action Notices
When an application is denied based on information from a consumer report, federal law requires the manager to send an adverse action notice. That notice must include the name, address, and phone number of the screening company, a statement that the screening company didn’t make the decision, and information about the applicant’s right to request a free copy of the report within 60 days and to dispute inaccurate information.3Office of the Law Revision Counsel. 15 USC 1681m – Requirements on Users of Consumer Reports If a credit score factored into the denial, the notice must also disclose the score, the range of possible scores, and the key factors that hurt it.
Small landlords skip this step constantly. A professional manager should have a system that sends the notice automatically, which protects the owner from Fair Credit Reporting Act liability and occasionally flips a denial into an approval when the underlying report turns out to be wrong.
Fair Housing Compliance
The Fair Housing Act makes it illegal to discriminate in housing based on race, color, religion, sex, national origin, familial status, or disability.4Department of Justice. The Fair Housing Act Every screening decision must apply the same objective criteria to every applicant: the same income threshold, the same credit cutoff, the same criminal history policy, regardless of who is applying.5Office of the Law Revision Counsel. 42 USC Ch 45 – Fair Housing Good managers document every step: the date the application was received, the criteria applied, and the specific reason for any denial. That paper trail is the owner’s first line of defense if a rejected applicant files a discrimination complaint.
Required Disclosures and Lease Signing
Before the tenant signs anything, federal law requires certain disclosures that the manager delivers on the owner’s behalf. For any housing built before 1978, the landlord or agent must give the tenant the EPA’s “Protect Your Family from Lead in Your Home” pamphlet, disclose any known lead-based paint or hazards, and share available inspection reports. The lease must include a Lead Warning Statement, both parties sign an acknowledgment, and a signed copy has to be kept for at least three years.6Office of the Law Revision Counsel. 42 USC 4852d – Disclosure of Information Concerning Lead Upon Transfer of Residential Property
Most states add their own mandatory disclosures on top of the federal rules, covering things like mold history, flood zone status, sex offender registries, or recent deaths on the property. A competent manager keeps a disclosure checklist tailored to the state the property sits in.
Once the applicant clears screening, the manager drafts a lease that complies with state landlord-tenant law: rent amount and due date, late fees, maintenance responsibilities, notice periods for entry and termination, and rules about pets, guests, and alterations. Most managers use digital signature platforms so every party gets a timestamped copy.
Before keys change hands, the manager collects the security deposit and first month’s rent. Deposits typically range from one to two months of rent depending on the state’s statutory cap. State law also dictates where the deposit must be held (some states require a separate trust or escrow account) and whether interest is owed to the tenant. Utility transfers get verified directly with the utility companies so the tenant doesn’t move in on the owner’s accounts.
The Move-In Inspection
A thorough move-in walkthrough protects the owner’s ability to make legitimate deductions from the deposit later. The manager goes room by room, documenting the condition of floors, walls, ceilings, fixtures, appliances, windows, and mechanical systems. Every imperfection gets noted and photographed. Both the manager and the tenant sign the resulting condition report, and each keeps a copy.
When the tenant eventually moves out, that baseline is what makes it possible to charge only for damage that occurred during the tenancy. Without it, deposit disputes turn into a he-said-she-said the landlord usually loses. About a dozen states actually require a written move-in condition statement by law, but professional managers do it everywhere.
What Tenant Placement Costs
Placement Fee
The placement fee, sometimes called a leasing fee or lease-up fee, is a one-time charge paid when a new tenant is signed. It typically runs 50 to 100 percent of the first month’s rent and covers marketing, showings, screening, and lease preparation. Because it’s charged each time a vacancy is filled, high turnover makes placement expensive over the life of a property.
Monthly Management Fee
Placement is often bundled with ongoing management, which usually runs 8 to 12 percent of gross monthly rent for residential properties. Larger portfolios and multi-unit buildings can negotiate rates in the 4 to 7 percent range. Read the management agreement carefully: some companies charge extra for lease renewals, eviction coordination, or periodic inspections on top of the base percentage.
Application Fees
Applicants pay a non-refundable application fee to cover the cost of credit checks, criminal background screening, and employment verification. Some states cap this fee by statute; others don’t. Where caps exist, they range from as low as $25 to amounts tied to actual screening costs, and in those states managers cannot profit from the fee. In practice, most application fees fall in the $25 to $75 range.
Placement Guarantees
Some companies back their placement with a guarantee: if the tenant they selected breaks the lease or gets evicted within a set period, the manager finds a replacement at no additional charge. Guarantee windows vary from 30 days up to 12 months, and they’re more common in full-service agreements than in standalone placement contracts. Ask about the guarantee before signing. It signals that the manager stands behind their screening, and it shifts some of the financial risk of early turnover off the owner.