Property managers are a must for property owners who don't have the time or desire to maintain their rental properties or deal with tenants. In many cases property managers can also increase the value of a rental property by keeping it in good shape and ensuring that it operates efficiently, according to the Bureau of Labor Statistics. For people with experience in real estate or property maintenance, and a taste for entrepreneurship, starting a property management company might be the right career move.
Obtain a real estate broker license by contacting the California Department of Real Estate (DRE). Property management companies are required by law to have a managing broker oversee activity in each office location. The broker is ultimately responsible for ensuring that the business complies with California real estate law.
In order to qualify for the broker licensing exam, you must have either a four-year college degree or a record of employment as a licensed real estate salesperson. You're also required to have taken eight college-level courses in real estate. As of 2010, the examination fee is $95. Upon successful examination, the DRE charges a $300 licensing fee and $51 fingerprint processing fee. Information on specific courses and application requirements are available on the DRE website.
Join a professional association. A good place to start is the local Multiple Listing Service (MLS), which is an alliance of real estate professionals within a specific geographic area. The MLS lists available properties for sale and rent within its boundaries. Several MLS associations operate in California. Most are operated by a local Realtor association. Each association creates its own fee structure, but an annual subscription ranges between $300 to $400. It is not necessary to a Realtor association to access MLS, though doing so provides networking opportunities with local real estate professionals.
Choose an office location. Property management companies can operate out of a home office or commercial location. Many start-up companies benefit from the low overhead of a home office. The majority of business can be conducted by phone, fax and Internet. Client meetings can be scheduled at a public location or at the rental property. If you choose to conduct business out of a home office, contact your city or county officials to obtain a license to operate a business at your residence. Business licensing fees for a commercial location vary by city and county, but generally fall from $100 to $300. Home-based businesses must also obtain a business license, but there is typically no additional licensing cost to operate out of your home.
Keep careful records of your property management documents and related financial transactions. According to the DRE, all documents related to a business transaction must be retained by the property management broker for at least three years. Keep all financial transactions related to the business in a separate account. If you handle client funds such as rent deposits, keep a separate record for each tenant and property owner. Also, maintain a trust account for client funds. The DRE cites poor record-keeping and financial mishandling among California's most common broker violations.
If you need rental property forms or contracts, contact the California Association of Realtors. It sells a variety of real estate forms and educational materials.
Consider purchasing liability insurance for your business, or you might be held personally liable for accidents that occur on a property you manage.
2016 Salary Information for Property, Real Estate, and Community Association Managers
Property, real estate, and community association managers earned a median annual salary of $57,040 in 2016, according to the U.S. Bureau of Labor Statistics. On the low end, property, real estate, and community association managers earned a 25th percentile salary of $39,910, meaning 75 percent earned more than this amount. The 75th percentile salary is $83,110, meaning 25 percent earn more. In 2016, 317,300 people were employed in the U.S. as property, real estate, and community association managers.
- Consider purchasing liability insurance for your business, or you might be held personally liable for accidents that occur on a property you manage.
- If you need rental property forms or contracts, contact the California Association of Realtors. It sells a variety of real estate forms and educational materials.
- California Department of Real Estate: Real Estate Broker License
- Bureau of Labor Statistics: Property, Real Estate, and Community Association Managers
- California Department of Real Estate: Fees
- U.S. Bureau of Labor Statistics: Occupational Outlook Handbook: Property, Real Estate, and Community Association Managers
- Career Trend: Property, Real Estate, and Community Association Managers
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