Property Manager Agreement Guide

A property manager agreement is the contract between a property owner and a property management company. It defines what the manager does, how they're paid, and what authority they have over your property.

When you need one

Any time you hire someone to manage rental property on your behalf. This includes:

• Residential property management — apartments, single-family homes, condos.
• Commercial property management — office, retail, or industrial space.
• Vacation rental management — Airbnb, VRBO, or short-term rentals.
• HOA management — homeowner association administration.

Key terms

• Management fee — typically 8–12% of gross rental income for residential, 4–8% for commercial.
• Leasing fee — a flat fee or percentage of first month's rent for finding and placing tenants.
• Maintenance threshold — the dollar amount above which the manager needs your approval for repairs (typically $300–$500).
• Owner reserve — funds held by the manager for routine maintenance and emergencies.
• Advertising — who pays for marketing and tenant placement.

Manager's duties

• Tenant screening — credit checks, background checks, income verification.
• Lease execution — drafting, signing, and enforcing the lease.
• Rent collection — collecting on time, handling late payments, and initiating evictions.
• Maintenance — routine repairs, vendor management, and emergency response.
• Accounting — monthly statements, annual tax documents, and security deposit tracking.

Authority limits

Define what the manager can do without your approval:

• Routine repairs — up to the maintenance threshold.
• Emergency repairs — what constitutes an emergency and when they can act immediately.
• Tenant disputes — whether they can negotiate move-out terms or settlement agreements.
• Legal action — whether they can hire attorneys for evictions or collections.

Make it legal

• Both parties sign.
• Attach the property address, current tenant list, and any existing lease agreements.
• Keep a signed copy with your property records.

A state-specific property manager agreement drafted to your situation takes about ten minutes.