If you’re a real estate agent looking to broaden your business offerings, you may have considered adding corporate rentals and property management to your services. While doing so is a great way to diversify your business, and add a new level of income, there are business risks to taking on rentals. In this two part series, we’re offering tips you can employ to safeguard your brokerage business when adding rental management services.
Tip #4: Get Contracts
You don’t want to enter the rental management business on a handshake. If you’re going to manage the corporate property, you’ll need a solid contract in place that details your role and responsibilities, as well as limits your liability for issues out of your control. Make sure you put any discussions with owners in writing at all times – you don’t want to have disagreements that turn into a he-said, she-said battle.
Tip #5: Have Insurance
You will need professional and general liability insurance for the property management side of your business. You also need to ask your clients to include your company in their homeowner and landlord insurance policies. This prevents you from being sued if a tenant gets injured or other issue arises. Ultimately the property insurance should cover you to prevent you from getting sued.
Tip #6: Be Picky
While it sounds ideal to manage any and all properties that knock on your door, you’ll want to use your discretion. Only take on what you can manage, and be picky about what properties you manage. Doing so will ensure you do a good and through job with all your clients and thus limit your liability. You may want to manage properties only within a specific geographic location or only a specific type of property (single family home), etc. Also, work with clients who value you and are willing to pay your fee. Be picky about who you represent!
Tip #7: Have a Point Person
To limit your liability, you’ll want to have a single point person for property owners and tenants. This is an opportunity for renters and tenants to develop a relationship with your company, one that is based on open communication and trust. Your point person will want to respond to inquiries immediately and quickly resolve problems that arise before they become liabilities.
Missed Tips #1-3? Read Part I here!