What is the purpose of a property management agreement?

The purpose of a property management agreement is to outline the specific terms and conditions between the property owner and the management company. This agreement serves as a formal contract that details the roles, responsibilities, and expectations of both parties.

It includes essential elements such as the scope of services to be provided by the management company, the duration of the agreement, compensation details, and any specific obligations the owner may have, such as providing access to the property or maintaining certain standards. By clearly defining these terms, the property management agreement helps to ensure that both the owner and the management company have a mutual understanding of their partnership, which is crucial for effective property management.

While establishing rules for tenant behavior, determining rental prices, or setting maintenance schedules can be part of the overall management process, these aspects are typically components of the broader framework laid out in the property management agreement, rather than its principal purpose.