What to Write and Must Include in the Property Management Agreement
If you get property to posses, you will have daily operation to manage. We would say that the most proper way to do so is to hire property manager and let the team manage its operation. For that, we do need to make property management agreement. You can’t just give order and be done with that.
You are hiring them to take care of your valuable belonging. Both parties must agree upon things before the management is done. Speaking about writing property management, there are some vital points that must be there in the form.
#1 Point in Property Management Agreement
To start things with, you need to make things clear about the services that one can and cannot do. Just because they are called property manager, it does not mean that they can do everything. After all, each manager provides different services for the price they get. Do pay attention to the fee too.
Each service from different manager might be priced differently from each other. There are even extra services that pay for more. So, be careful when making your choice. Property management services list is one to concern about.
#2 Point in Property Management Agreement
It is an agreement we are talking about here. It is not something that will last forever. That is why there is duration of the contract. Since it is a contract, it might last a few years or more as needed. Depending on what the two parties agree upon, the duration might differ from one to another too.
Longer duration especially is one that needs assurance though the shorter one might need it as well. If you find it necessary, you are free to use it. Each agreement carries its own risk. So, just consider everything necessary before it is signed.
#3 Point in Property Management Agreement
Even though it will be the property manager’s job to find the tenant to occupy the property, the owner will still have his/her own responsibilities to do here. There are even things that can’t be done after the property is occupied even if he/she is its owner. What are property owner responsibilities?
Among them, the owner will have responsibility to set up reserve fund for emergency. The fund will also be of use for the manager to do daily operations and maintenance. After all, you are the owner, so you must be one to prepare the funds.
#4 Point in Property Management Agreement
Don’t forget to include liability and termination clause as well. Liability is there to protect the manager in case of damage. That being said, he/she will still be responsible if the third party he/she hired is the one who causes the damage. Liability protects one that is not at fault in case of damage.
As for the termination clause, property management agreement will need to have the information stated when things must be ended if things don’t work out. Any unexpected things can happen, so it is best to set these terms too just in case.
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