Author Topic: Starting a property management company  (Read 865 times)

Neo

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Starting a property management company
« on: May 07, 2018, 09:43:52 PM »
Background: I own 7 rental properties with 21 total units. My goal is to continue growing this portfolio until it surpasses my "real job" income and beyond. I have been toying with the idea of opening a property management arm of my business serving other landlords to provide an additional revenue stream after quitting my w2 job. The issue I'm running into is it seems like there are regulations that require  a property management company to hold a real estate brokers license (not just an agents license, which I also dont have). A brokers license seems pretty difficult to acquire. Is anyone else doing property management in addition to owning and managing their own properties? I did this on a micro scale last summer providing lawn care to area property owners and it was successful though I didn't scale it enough to make a large profit due to time constraints. It seems like the brokers license requirements spawn from the need to follow fair housing laws when sourcing new tenants. Could I do property management just without the tenant acquisition piece? Scheduling repairs with contractors, doing lawn care and routine maintenance, refreshing units when a tenant moves out, etc. Would people still find this service valuable without the tenant acquisition piece? Would it be legal to operate without a brokers license in such a setup? I'm in Ohio if that helps. Looking forward to your feedback/discussion. Thanks!

Jon Bon

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Re: Starting a property management company
« Reply #1 on: May 08, 2018, 07:31:19 AM »
Posting to follow.

I guess it depends on how legit you want to be. Do you want to look after a few fellow landlord houses yourself? I feel that would be NBD.

You want to solicit new landlords and manage their houses? Yes probably need a licence. I kind of feel that is a BS requirement, but I guess that is the local law.

Neo

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Re: Starting a property management company
« Reply #2 on: May 08, 2018, 09:51:17 AM »
The licensure laws seem to be pretty standard nationwide from my research. Collecting money seems to be another trigger. So basically to avoid licensing you would have to be mostly a handyman/landscaping service is what I'm gathering.

SeattleCPA

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Re: Starting a property management company
« Reply #3 on: May 08, 2018, 06:27:22 PM »
Neo, I think you understand the issue. I've looked into this before too for a family member. And the barriers to entry (Washington state) are significant. Almost insurmountable.

tralfamadorian

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Re: Starting a property management company
« Reply #4 on: May 09, 2018, 05:25:15 AM »
Property management is a tough business. Why donít you just stick with expanding your landscaping business and advertise towards landlords? No license required. No evictions. No fair housing. No sewer calls on holidays. No frivolous lawsuits.