Property Managent Agreement

[Derek Clark]

My neighbor is moving and wants to rent his home that is across the street from my primary residence. I have three rental properties in the same area. He and I are in discussion on me acting as the property manager for his house because he will be about 3 hours away. 

I would like to work out a deal with him because I would be finding the renters and basically handling everything as if it is another rental property of my own and I would make money of course. 

what advice do you have to set this deal up the right way between my neighbor and I? I told him that I would need at least 175.00 a month or 10% for it to be worth my time. The house would probably rent for around 2200/month it is in great shape. Am I asking the right amount to manage the property? 

thanks for your help!

[Marcia Maynard]

We own and manage our own rental properties. But when a friend asked me to manage their house as a rental when they left the country for a couple of years, I had to look into the legalities of what I could do and what I couldn't do.

Some jurisdictions require a person who does property management for others to be properly licensed, bonded and insured. Some jurisdictions require less. In any case, you would do well to think this through and make sure you have appropriate documentation in place to act on the behalf of the other homeowner. As well as to protect yourself.

What we ultimately did in our situation was to write a contract between the homeowner and I whereby the homeowner functioned as the landlord and made the decisions, with me working in an advisory capacity. I was the "boots on the ground", but the rental contract was between the homeowner and the tenant. If something came up, I would assist in getting the work done for the homeowner and the tenant, but I did not function in the full capacity of a property manager. I merely charged a "trip charge" for anytime I had to go to the property to inspect the property or assist with anything. Other than that, I gladly shared my knowledge for free.... just as I do here. :-)