March 2024
You need a signed, unexpired property management agreement with the property owner before managing a property. When considering what to include in a property management agreement, try to think of any issues that normally come up in the day-to-day management of property. You should fit the agreement to the unique needs of your client, to special problems associated with the property, and to your skills as a property manager.
A property management agreement must include, but is not limited to:
- The address of the owner’s property.
- Your duties and responsibilities.
- The duties and responsibilities of the owner.
- The specific charges that will be paid by the owner.
- The authority and powers given by the owner to you.
- The term (length) of the agreement.
- How either you or the owner can terminate the agreement.
- The terms and conditions of the agreement.
- The fees and any other form of compensation you will receive for managing property, including when such compensation is earned and when it will be paid.
- A description of the monthly statements of accounting you must provide to the owner.
- How the property management records for the owner’s property will be transferred after termination of the agreement.
- Disclosure if you are using your employees or a business you have any financial interest in that will provide services for the owner’s property.
- A statement that you will disclose, in writing, the planned use of your employees or a business you have any financial interest in to provide services for the owner’s property, if you didn't disclose this when the property management agreement was signed.
- A unique identifying code you assign to the property management agreement. Use this code on all transactions and records to reference the agreement.
- The signatures of both you and the owner.
- The date of the agreement.
- Specific charges to be paid by the owner.
You can’t sell or exchange a property under a property management agreement. If you are a broker or principal broker and the owner wants to list their property for sale, you must negotiate a listing agreement with the owner separately. Licensed property managers cannot list a property for sale or exchange.
Limit your activities to those authorized by the property management agreement. If you need to take on additional duties, or if you change office procedures, management fees, or tenant relations procedures, amend the agreement in writing. Amendments must be signed and dated.
Each property management agreement must be retained for six years after termination or expiration of the agreement. For more information on property management agreements, see OAR 863-025-0020.
Excerpted from Welcome to Property Management in Oregon