03 Nov Property Management Contract
Property management is a crucial aspect of owning a rental property. As a landlord, it is essential to have a clear contract in place with your property management company. A property management contract lays out the terms of the agreement and ensures that both parties are on the same page regarding the expectations and responsibilities of the property manager.
A property management contract is a legally binding document that outlines the relationship between a landlord and the property management company that will be responsible for managing their rental property. This contract typically includes important information such as the scope of services, the fees associated with those services, and the terms of the contract.
Scope of Services
The scope of services section of the contract outlines the specific responsibilities that the property management company will undertake on behalf of the landlord. This section typically covers tasks such as rent collection, tenant screening, property maintenance, and lease administration. The contract should clearly detail which services are included and excluded in the property manager`s responsibilities.
Fees
Most property management companies charge a percentage of the rental income as their management fee. The contract will list the percentage of the rental income that the property management company will charge as its fee. It is important to understand the fees associated with the services provided and what circumstances may incur additional charges, such as maintenance or repairs.
Term
The term of the agreement refers to the length of the contract. Typically, property management contracts range from 6-12 months and may renew automatically for additional periods of time. The contract should outline the procedures for termination and renewal to ensure that both parties are aware of their responsibilities and obligations.
Insurance and Liability
The property management contract should stipulate the insurance coverage that the property management company is required to carry and the liability limits. It is important to ensure that the property management company carries liability insurance to protect both the landlord and the property management company in case of accidents or damage to the property.
Conclusion
In summary, a property management contract is a critical agreement between a landlord and a property management company. When drafting the contract, it is important to ensure that it covers the scope of services, fees, term, insurance, and liability. Having a clear and comprehensive agreement in place can help avoid misunderstandings and disputes between the landlord and the property management company. As a landlord, make sure to work with a property management company that is experienced and knowledgeable in the field.