Legally speaking: Can I offer property management services?
On March 2, 2015
By Lorie Garland, OAR Assistant Vice President of Legal Services
The OAR Legal Assistance Hotline receives an array of real estate-related legal questions — including license law issues, disclosure, contract law, ethics and commission problems, among others. In an effort to help you work within the law, our “Legally Speaking” series spotlights some of the timely questions that are being asked by REALTORS. This one involves offering property management services…
Q: I am a licensed agent. I am also the managing member and sole owner of an LLC that owns rental properties. The leasing and management of the properties are done through my LLC. My broker requested I handle my rental properties through my LLC (not the brokerage) because she does not want the brokerage to get into the property management business. I am doing well with my rental properties and would like to offer property management services to other property owners. Can I, through my LLC, provide property management services on properties I do not own?
A: No. Providing property management services on properties you do not own requires a real estate license. Therefore, these services must be done through and in the name of the brokerage company that holds your license. As your broker does not want to offer property management services you would have to transfer your license to a broker who does or would be willing to offer property management services and the services would then be done in the brokerage name. Your unlicensed LLC can only manage properties the LLC owns.
Tags: legal, Legally Speaking