BROKER RISK MANAGEMENT
WEEKLY PRACTICE TIP
Agents Managing Own Property
Q: I own several rental units that I am managing by myself. My broker does not allow agents to manage property because of the potential liability. Is it okay for me to manage my own properties?
A: First, you must check with your broker whether it is permissible for you to manage your own properties.
According to the Business & Professions Code, property management is licensed activity if it is “for another.” That is, you are working as an agent for a separate principal. Any time you are doing property management for another person (sometimes this may be a past or current client), you are doing so under your broker’s license and must have his/her/its permission.
See Weekly Practice Tip “Property Management” at:
But, if you are managing property in which you have an ownership interest, you are not engaging in licensed activity. Most brokers will have no objection to you managing your own rental units provided you do so entirely separate from the brokerage.
PRACTICE TIP:
1. If you are managing your own rental units outside of the brokerage, it is important to NEVER:
A. Use any of your broker’s materials, e-mail, fax machine, etc.
B. Allow a tenant to send or deliver rent checks or notices to you at the office address.
C. Advertise the rentals in the MLS unless you are a broker and have your own
MLS membership.
D. Use forms that have your broker’s name on them.
2. It is essential that all of your activity in managing your own rental properties be entirely separate from your employing broker. If you involve your brokerage in any way, it could lead to liability for them, and perhaps be a violation of company policy for you.
WEEKLY PRACTICE TIP: DO NOT FORWARD TO CLIENTS. This Weekly Practice Tip is for the exclusive use of clients of Broker Risk Management and their agents. It may not be reproduced or distributed without the express written consent of Broker Risk Management. The advice and recommendations contained herein are not necessarily indicative of standards of care in the industry, but rather are intended to suggest good risk management practices.
© Copyright Broker Risk Management 2014 07/18/14