Property Management Agreement: Fill & Download for Free

First to give some background. My husband and I have lived in our house since 1992 when he inherited the house that his parents bought in 1954. Our driveway is located right next to the neighbor’s driveway, and when my husband started driving in 1970, by mutual consent, my mother-in-law paid to have the dirt area between the driveways paved over so my husband would have off-street parking. We have parked in that spot ever since. The original owners both passed away, and the house has been sold a few time, but we’ve always had a mutual agreement with each owner that we could still park in what we now refer to as the center driveway. The property has sold yet again, and is now a rental, but we have our usual agreement with the owner that we can still park in the center driveway, since the house next door has a double driveway on their property. So new renter moves in, and parks on the property line, so close that we can no longer get in or out of our car even though he has 10 feet on the other side of his car. We park a small Fiat in the center spot, and park it as far forward as possible on our side of the property line. So he now parks his truck forward leaving 6 feet to the sidewalk. Yup, he’s intentionally making it so we can’t get in and out of the car. Then he starts putting orange traffic cones on our side of the property line! We keep putting them on his side, and he puts them back. His last trick was to spray paint a big blue line, on our side of the property line. That was the last straw. I’ve contacted the property manager, they agree that yes, we are allowed to park on the center driveway, and that the spray paint is a bit much and is supposed to be removed. It’s been 2 months, and we could actually get in and out of the car up until 2 weeks ago, but the neighbor has started his tricks again. Time to contact the property manager again, and oh by the way, the blue line still hasn’t been removed.One more thing, I leave for work at 4:30 am (yes, it’s VERY early), I’ll go out to my car, and the neighbor is just sitting in his car. I leave, he starts his car up and follows me to the freeway, and we think drives back home, because his car is there when our daughter leaves in the morning. Very creepy.

I’ve got a good one (or, in retrospect, a truly awful one) here:At one of the communities my company owns there is a clubhouse that is rarely, if ever used. A small church inquired verbally to the on-site property manager if the clubhouse could be used on Sunday morning for hour-long services. When the property manager relayed the request to me, I told her that the church could have the space (for free; consider it a donation) as long as they cleaned it up afterwards and there were no space timing conflicts with residents of the property.Google ImagesWell, my scheming property manager tells the church pastor that the space was theirs for $100 per hour, payable in cash to her office. Perhaps the church pastor was a tad too trusting and naive, but this went on for approximately a year, to the tune of about $100 -$200/week.Flash forward to a year later, and this same property manager has been just fired by yours truly for employing family members in certain low level functions, and reporting neither their numerous absences or the family relationship as problems developed from there. The day she was fired, she tells the church pastor that the church’s rental agreement has been immediately terminated (by me, naturally) and not to show up on Sunday for services.Of course, later that week I received a phone call from my new property manager, informing me that a church pastor was sitting in her office wanting to know why his “rental agreement” on the clubhouse had been terminated, and if there was anything that could be done to get me to change my mind. It was quite an interesting meeting the pastor and I had together the next day!Now I’m not a religious person and I don’t know if heaven or hell really exist, but if hell does — stealing from a small church (and from your employer, as you have stolen a donation) … then trying to immediately evict the church once your theft will be discovered, even though you’ve already lost your job … well, you’ve just earned your ticket.

Should real estate investors manage their investment property themselves or use the services of a professional property management? To answer this, let’s take a look at the pros and cons of a property management company:Pros of Property Management Companies1. Experience in the Real Estate MarketCompared to the average property investor, property management companies have supreme experience in the real estate market. Moreover, they are up-to-date on state and federal rules and regulations regarding landlord-tenant rights and responsibilities. Investors and landlords that are new to the real estate market would most likely benefit and learn from the experience provided by property management companies the most.When it comes to your investment property, making mistakes can be costly. A property management company will keep you in check regarding all the legalities and framework of the real estate market, meaning you’ll be less bound to make silly mistakes or unknowingly violate any laws and regulations.2. Take Care of Tenancy and EvictionOne of the best advantage of hiring a property management company is that they rid real estate investors of one of the toughest tasks, like finding appropriate tenants. This requires a thorough tenant screening process, which can be a pain for the average property investor.Property management companies deal with this issue without any difficulties. A property management company will create application forms, interview applicants, and choose the best tenant. This includes studying a tenant’s financials, recommendations, and legal situation.In addition, a professional property management will deal with any issues tenants may have after they move into the rental property. They receive their calls, listen to their suggestions and complaints, ensure that tenants stick to the rules of the lease agreement, and handle emergency repairs and maintenance issues to make sure tenants are happy and satisfied.Not only that, but professional property management also handles the undesirable tasks of evicting tenants from the rental property, in addition to the tenant turnover process. They receive the keys, inspect and clean the property, and handle the process of marketing it and finding new tenants again. Basically, they take away some responsibilities that real estate investors dread.3. Improved Services and Response TimeSome real estate investors don’t have a flexible schedule for attending to tenants and the investment property’s needs. Thus, another pro of hiring a property management company is that they handle all maintenance and repair tasks related to the investment property. This includes regular check-ups, maintenance, cleaning, and repairing of any damages.Moreover, professional property management companies typically have a solid network of plumbers, carpenters, electricians, and all other handymen. This means they provide prompt services in case of any required repairs, which keeps the investment property in a good shape. After all, any damage will add up to your rental expenses, and eventually will affect your rental income and overall rate of return on investment. On the other hand, a professional property management will most likely notice and fix damages in short order.4. Financial HelpThis advantage includes a number of aspects. First, thanks to their experience in the real estate market, property management companies have a good idea on how to set the right rent for the investment property that will generate a positive cash flow and maintain a good occupancy rate. Moreover, it will take care of collecting rent and ensure tenants are paying on time.Not only have that, but property management companies also help in setting a budget in order to ensure you stay on track of your expenses. They also keep records of all the financial aspects related to the rental property and ensure you’ll have access to these records when needed.Cons of Professional Property Management1. They’re Not CheapThe main reason many enter the real estate investing business is to make money through rental income. When hiring a property management company, you have to pay a significant percentage of rental income (typically 4% - 12%) for their services. This will definitely affect your profit margin as you’ll lose some of your revenues. Real estate investors who depend on their rental income to pay off their mortgages have to take this into consideration before hiring a property management company.Aside from the monthly fees that property management companies require, a property investor will also pay for additional different expenses when needed such as costs advertising and finding and screening tenants. This ultimately affects your cash on cash return; the higher your rental expenses are, the lower your cash on cash return becomes!Note: Mashvisor’s investment property calculator helps you calculate cash on cash return (in addition to other metrics like the cap rate and cash flow) to ensure you’re getting the best return on investment when determining whether or not a property management company is really needed.2. Less Control = Less KnowledgeAs mentioned earlier, one of the reasons why a property investor would consider hiring a property management company is not having to deal with issues like tenant screening, handling repairs and maintenance, collecting rent, tenant turnover and eviction process, etc. However, going through these processes yourself and interacting with tenants allows you to gain the needed knowledge on real estate investing.Therefore, giving a professional property management company the full control over a rental property will create a challenge of building relationships with tenants and leave the property investor feeling lost in the real estate market – simply because you can’t understand something that you have no experience with.Professional Property Management: Yes or No?The answer really depends on you and your investment. Although they’re not cheap, the list of services provided by a property management company make the amount paid irrelevant for some real estate investors. So, as a property investor, you should analyze your rental income and decide whether or not hiring a professional property management is worth the money.Head over to Mashvisor for the latest news and guides related to real estate investing to help make the best real estate investment decision!