The property management agreement is a very important document
Property management companies that manage rental property for the property owner need a property management agreement to govern the relationship between the property manager and the property owner. Not having a well-drafted property management agreement will cause many problems for both the property manager and owner and it will hinder your management company from developing the way it should to provide better service and produce more profit.
So, what should a property management agreement address? Below is the table of contents for the property management agreement we use. Each heading and subheading has its own provisions that govern the parties’ relationship and how the property manager and owner are to act during the term of the agreement.
Parties and Term
Parties
Certification
Term
Manager Services and Authority
Services and Authority
Independent Contractor
License Limitations
Leasing
Rental Rate
Lease Term
Lease Agreement and Legal Notices
Advertisement
Screening Tenants
Remedy For Tenant Early Termination
Liquidated Damages For Tenant Early Termination
Tenant Default
“Cash-For-Keys”
Evictions
Financials
Monies Held and Used for Owner
Costs and Expenditures
Receipt and Disbursement
Order of Disbursement
Payments on Owner’s Account
Survivability
Records
Tax Preparation and Filings
Mailing
Compensation and Fees
Maintenance and Property Conditions
General
Rent-Ready Condition
Repairs That Fall Under F.S. ch. 489
Repairs, Materials, and Commission
Utility and Service Bill Payments
Non-Emergency Repairs
Emergency
Bids/Estimates
Move-Out
Contracted Services
Utilities and Landlord Agreements
Mold or Contaminant Testing
Swimming Pool (if applicable)
Compliance Costs
HVAC
Appliances
Home Warranty
Correspondence
Correspondence
Absence
Pets
Pets
Emotional Support and Service Animal
Third Parties and Neighbors
Owner Responsibilities
Owner Duties
Owner Provisions
Owner Liability and Casualty Insurance
Owner Certification
Lead-Based Paint Disclosure
Owner Default/Breach
Amenities and Community Property
Homeowner and Condo Association (HOA/COA) and Ordinances
Statutory Landlord Obligations under F.S. 83.51
Inspections
Routine
Tenant-Related
Government and Insurance Related
Amending and Terminating the PMA
Amending the Agreement
Termination of PMA
Additional Terms
Multiple Properties
Multiple Owners
Fair Housing
Attorney’s Fees and Jury Trial
Acts of God
Construction Lien Prohibition Notices
Indemnification
Binding Agreement
Entirety Clause
Error & Omission
Tenant in Default
Assignment
Addenda
Each of these headings need to be addressed in your property management agreement. Use an experienced property management law attorney to draft your property management agreement. Also, help your attorney by sharing your management experience relative to these topics and the business model you want to implement as it relates to each of these headings listed above so that your attorney can prepare an agreement specific to your business model.
Experience is the best of all teachers, so your property management agreement will develop and change over time as you learn more about yourself, your business, other people, and your goals for your business. As you encounter situations your the management business that need to be addressed as a matter of policy and procedure, keep note and take the idea to your company’s leadership for suggestions. Once the policy or procedure is approved, take the matter to your attorney to draft a provision that will be incorporated into your property management agreement.
If you are a property investor and need a property management company to manage your rental properties, aDoor Property Management, LLC can help you. Click the button below to submit an application.