Becoming a property manager for someone else’s property?

[Bryan Cork]

Hello all! My wife and I own a SFR that we manage ourselves, and have for the better part of 3 years. That makes me know just enough to be dangerous :) So now my parents want to buy a rental property and they want us to manage it for them, and I’m not sure where to start digging into what we need to do to make that legal and legit. First, we are in Colorado Second I know it needs to be done under someone with a brokers license, and my wife works for a friend of ours who is a real estate agent and is willing to put the property management under his license. Third.....that’s all I have so far. Any suggestions on how to move forward? Thank you!

[Account Closed]

Hey Bryan!

Sounds like you're off to a good start. @Ray Harrell, a broker's license is required for legal property management as it's considered a real estate transaction, you're taking strangers through someone else's homes and signing leases on their behalf.

Bryan, do you have your real estate license yourself? You'll want to get that first, and then hang it with the brokerage that agreed to let you use their name. In MI you need your real estate license to conduct showings, so this is an important step for any property manager. You'll also want to start collecting/finding the documents you'll need to manage a home for your parents, including a management contract spelling out your services and fee structures. Once the contract is signed, register the property with the city under your management, collect a copy of the keys and get the current tenant information and any marketing information the current owners have on file for the home. 

The biggest issues that can happen when managing for family can be avoided when you set up a proper structure that everyone agrees to in the beginning. In your management contract, address management fee, renewal fee, placement fee, maintenance costs, minimum account balances required, payment methods, etc...

Good luck!