Tips for when I become a PM for a friend?

Question

A good friend of mine owns a fully rented duplex but needs to move out of state. I've been studying/reading books about REI and following BP for quite some time now and will be buying my own property shortly, but this opportunity popped up to help a friend. I see it as a

What are the most important things for me to be aware of as I begin as a property manager for a friend? What ground rules will we need to discuss and sign contracts for so that this goes smoothly? I am very confident in my abilities, but I'm naturally worried an unexpected disagreement could cause tension in our relationship.

Thanks for the help!

Rosa Regier · Answer

Check your state as it may require a license to be a PM for someone other than yourself.

Eliott Elias · Answer

Depending on your state you need a license. I don't do business with friends if I am not rock solid in my systems and processes. There will be a learning curve for you and it will cause conflict.

Nathan Gesner · Answer

1. Know the state licensing law. Most states will require you to have a license and work under a Broker. The Broker may want a cut of whatever you are making. It's not as easy as just shaking hands with your buddy.

2. You should have a written PM Agreement. This is a legal, binding document that explains your role and responsibilities, discloses fees, explains the termination process, etc.

3. You need the ability to report income/expenses each month. This could be a simple spreadsheet, but a professional provides a much better product.

4. Most important is that you need to know the law and how to handle problems. You're taking responsibility for a large investment and should know what you are doing. Your friend is hiring an inexperienced amateur, so you should charge accordingly. It may not be worth your time.

Jevon Shaw · Answer

Make sure everything is in writing. Also, since you are friends, try to come up with an agreed upon general conflict resolution framework. It's not a matter of if things come up, it's a matter of when.

Tips for when I become a PM for a friend?

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