All Forum Posts by: Blaise Peterson

Also, are you sure the numbers are correct? Is it possible that the $100k is only the gross residential income? The commercial units would need high credit tenants with very strong, long term leases for this to work.

0 Votes

Pittsburgh, Pennsylvania

Probably not the answer you are looking for but, at your age, college is more important and your entire future is defined by how stellarly you perform in your first job. Keep saving your money (great job, so far!) and start RE in five years.

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Pittsburgh, Pennsylvania

Quote from @Henry T.:

For me, who has never used property management, this is very enlightening. I never considered this could be an issue. I always assumed ending a PM contract would be a no brainer, but here you're on the hook if you have plans to sell.

Two of the three houses she wants to sell have tenants so she is kind of forced to sell to an investor/wholesaler unless she wants to wait til next year when the leases are up. This is a lot less money than if she were to sell to a homeowner. She doesn’t want to wait til next year so it is stressful that her PM isn’t being friendly. Shes been with them since 2009 so you’d expect a little help.

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Spokane, Washington

Quote from @Bill B.:

Is there a reason she doesn’t want to list with her PM? Mine offers a discounted rate when I used them. (On both the buy/sell commissions and 6% of rent collected vs 8% on the newly purchased property.)

They’ve got marketing down, they’ve got the pictures and the contacts.

My understanding is that the PM she originally signed on with was a do-all shop. A few years ago, it was bought by a PM franchise. Of course the franchise is owned by a broker but there is no indication that he/she has ever sold a property.

0 Votes

Spokane, Washington

Quote from @Drew Sygit:

@Blaise Peterson from a PMC point of view:

If the property is vacant, we'd just terminate the contract, because there's nothing really to manage and we don't just want to be used cut the grass.

If tenant-occupied, there's a host of liability issues for a PMC if owner hires another agent to list for sale:

1) Who knows what transgressions the Owner's agent will cause with the tenant while showing it, possibly resulting in the owner and the PMC getting sued.
-Why would a PMC want to assume the risk of a lawsuit?

2) The Owner's agent will want to show the property at a moments notice, which sellers bend over backwards to do, but tenants have no incentive to cooperate with. Depending on how abrasive the agent is, this may have a major negative impact on the PMC-Tenant relationship.

3) In general, the Owner's agent will throw the PMC under the bus for everything they can to avoid accountability.

So, there's often a conflict of interest and a smart PMC will look to terminate their management if an owner hire's another agent for a sale.

Great answer. Thanks Drew

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Spokane, Washington

I’m confused by the PM’s statement that the property would be represented by two agents, which is not permitted. To me, the Agreement’s 1% clause implies that an outside sellers agent is permissible.
I only do commercial RE and don't have experience with SFs. Is this an NAR rule that applies to SFs? Is it a Spokane thing?

0 Votes

Spokane, Washington

Quote from @Theresa Harris:

I'd read their contract, but your sister hired the PM to manage her property, not to sell it. If it says they get 1%, then that is what she agreed to. What happens if she fires them and then lists it? Does she still have to pay that 1%?

The contract says that if she sells it within 90 days following the termination of the contract, she owes 1%.

1 Vote

Spokane, Washington

Quote from @Andrew Bosco:

It depends on their contractual management. They may need a notice to quit their services, which may include listing. better to follow up on documentation to verify.

Her management agreement says the PM gets 1% of the sales price is she sells it. This 1% is waived if it’s sold using the PMs broker.

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Spokane, Washington

My sister in law wants to sell three sf rentals in Spokane. Her management company is telling her that listing the property using an outside agent means the property is being represented by two agents—the PM and the sellers agent. The manager said this isn’t allowed and that she would need to terminate the management agreement before it’s listed.

I’ve sold a fair number of properties that are professionally managed and it’s always been a cooperative arrangement between the PMand my agent.

Can someone please help me understand what’s going on?

0 Votes

Spokane, Washington

Here's a WSJ article that discusses this topic. https://www.marketwatch.com/story/our-children-dont-have-the...

1 Vote

Pittsburgh, Pennsylvania

All Forum Posts by: Blaise Peterson

Blaise Peterson has started 2 posts and replied 22 times.

Post: What are my options to make this deal work?

Post: My Situation (First Post)

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