Tips for a Good Property Management Agreement
Hiring a property manager can take a load off your plate.
Relinquishing the responsibility of dealing with maintenance, repairs, collecting from tenants, and/or responding to complaints is a good feeling. Whether you're leaving for a vacation or you own a rental property, you'll need a property manager that can do what you need.
Before you sign a property management agreement, it's important that you set out your expectations with the management company. Getting a good deal is nice, but only if you're getting the service you require.
Today, we're going to give you some tips for what to look for in a property management agreement. If you can do separate the good from the bad in the contract, you'll have your property well looked after.
Services and Fees
The most important thing that you need to understand is what services they're providing and how much they cost. This should be clearly outlined in the property management agreement along with the fees for extra services.
Look closely at the management fee, as it should discuss some of the finer details. A management fee could be high because they're including services that another property manager charges extra for. It's a lot of reading to go through all of this, but it's important in having a clear understanding of what you get.
The liability section of the contract describes what the property manager takes responsibility for and what they protect themselves from. In all likelihood, they won't make themselves liable except in cases when they've been negligent, resulting in damage to the property.
One of the sticking points here is the hiring of third parties. A property manager will be responsible for hiring cleaners, contractors, and finding tenants. All you want is for the property manager to take the proper care in finding and dealing with tenants, contractors, etc.
Duration and Termination
You should clearly understand the length of the contract if you're going to be happy with it. It's not desirable to go into a long-term when you've never dealt with the management company before. Unfortunately, most contract durations are at least 1 year.
For this reason, it's important to look at the termination clauses. This should state the scenarios in which each party has the right to terminate the contract. It'll also say the notice you have to provide, the fee for breaking it, and any obligations after you've terminated it. This is to protect both parties from significant financial loss.
Getting Your Property Management Agreement Right
Understanding a property management agreement will help you find the best property manager for your needs. At Source 1 Property Management, we aim to cater to your needs. We specialize in rental, upscale, and commercial property in the Pembroke, South Shore, and Marshfield areas.
To discuss your property management needs before you sign a contract, schedule an appointment with us today.