Congratulations! You now own a string of residential property in Baltimore. You’ve worked hard to make that investment possible, and now at last, you are the proud owner of multiple rental units. Now what? Ideally, you should contact a service provider of residential property management in Baltimore, and discuss your plans to manage the property. Ultimately, unless you want to manage the property yourself, you’ll arrive at an understanding with the property manager. This requires formalizing that understanding in a legally-binding contract.
Here’s what to expect in a Baltimore residential property management contract.
Understand the Basics First
The Baltimore County Council passed Bill 87-07 on December 19th, 2007. This requires the registration and licensing of all rental or leased properties meeting a certain criterion, with Baltimore County. For any residential property management contract to be legal, this requirement must be present. Otherwise, you may have an unenforceable contract with the rental property manager.
If you use a service provider of premier property management in Baltimore, expect the professionals there to inquire about the status of your license and registration. If you haven’t yet registered your property, most professional property managers may offer to assist you with that process as part of their initial service offering.
The Core Contract
With the basics out of the way, it’s time to look under the hood of a typical residential property management contract. Knowing what to expect will help speed up finalizing an agreement so your property immediately receives the full benefit of a professionally managed building.
Here are the main components typically stipulated in a contract of this type:
- Services and Fees: The contract will specify all services that the manager is responsible for; and will outline a fee and payment schedule and process. There may even be clauses detailing tasks and duties that are out of scope. Some contracts may also outline charges for these “extra” duties, if you (the owner) wish them to perform such tasks: E.g.: Guiding and facilitating your property investment and marketing activities using the units they manage.
- Your Responsibilities: Though the service provider will assume responsibility to manage the property on your behalf, you still own the units. As such, you have specific roles and responsibilities to perform. Many contracts for residential property management in Baltimore specify those responsibilities, including making sure the property is adequately insured, and that you set up a contingency fund for emergency repairs.
- Restrictions: Most rental property managers prefer to control access to the properties they manage. The contract may include clauses that prevent you from having run of the property (i.e.: entering, doing work on, changing/modifying). Also, don’t be surprised to see restrictions placed on your ability to bring in renters, or terminate leases or rental agreements.
- Termination: This is an important clause that all residential property management contracts must include. This section specifies not only the causes for termination by the manager, but also how you (the property owner) may initiate termination.
Once the contract is drawn-up, a company providing premier property management in Baltimore will always provide owners ample time to review and discuss its contents. If your prospective property manager insists you sign something in a hurry, then that’s a red flag! Also, you should engage your own legal counsel (attorney or lawyer) to review the document before signing it.