New Property Management Company Setup Checklist [3 OF 3]

New Property Management Company Setup Checklist [3 OF 3]

Note: This article has been updated since it’s original publication.

Activating Your Action Plan:

How community association management companies turn a profit
You created your Action Plan to start a property management company, now you are ready to follow through and implement that plan.

Here are the steps to follow to actually create your company and get ready to operate:

Incorporate.

To protect yourself from personal liability, you should operate your new company as a corporation. You are dealing with millions of dollars of real estate and with homeowners who can get upset with you because you are enforcing the rules of the community. It would be foolish to risk personal liability so protect your personal assets behind the wall of a corporation. You can find online services that will incorporate your business, but not a bad idea to consult with a local attorney too. It’s a good idea to have an attorney that knows community association law available to you for legal advice.

Develop a Management Contract.
You are the legal agent for the communities you manage. This agency relationship is established in the management contract. The contract describes the services you provide and the management fee for these services. The contract should also protect you from liability except in cases of negligence—which cannot be contracted away. Normally, a management contract also has a Schedule or Reimbursable Expenses, like postage, printing, resale certificates, etc. attached to it. These are important to list and price correctly since the reimbursable expenses are revenue generators for you. You should mark them up from your actual costs to cover your time involved in each of these items. We have provided a free sample management contract here for you to use.

Download Sample Management Contract.
Establish a web presence. Get a management company web site in place with a business email address, not AOL, Gmail or Yahoo. Use a web site specialist like AtHomeNet that can setup a professional looking management company web site for you that includes your domain name and company email. Make sure they help you with SEO (Search Engine Optimization) so your new web site can be found in searches for community management.

Print Letterhead/Envelopes.
Have a printing professional create a logo for you and create good looking letterhead on bond paper with matching envelopes. You will want to make the logo part of the web site and on other sales documents. The logo becomes something that instantly identifies your company.

Develop Sales Documents.
You can use Microsoft Publisher (part of Microsoft Office Professional) templates to create brochures, business cards, and other professional looking sales documents.

Purchase Property Management Software.

TOPS [ONE] Platform
You won’t stand a very good chance of getting that first management contract if you can’t show a prospective community you have the tools of the trade– even a carpenter needs tools before he can start work. This is the time to make the decision and purchase TOPS [ONE] industry specific software.

Put Together a Sample Board Reporting Package.
A prospective Board of Directors is going to want to see what a sample report package looks like. You can use the software you just purchased to create this package or get canned samples from the software company.

Let Local Contractors Know About Your New Management Company.
Remember, as part of investigating the local management scene you were going to talk to contractors like lawn, snow, pool, plumbers, etc. Now is the time to let them know that you have started your company. Start a list with contractor names/address/phone #’s so you are ready with a “preferred” list of contractors.

Write a Press Release.
You want to let the local market know you are there. Most local papers will print a press release if you write it for them. Look online to find the format of a press release. It should be short and to the point and no more than 1 page. These last few steps you might want to hold off on until you get your first signed management contract:

Set up a Management Office.
This means following through on purchasing all the things you budgeted for so you have an operational office. A business sized desk, chair, file cabinets, phone system, supplies and any of the other things you need to have a working office. If this is a home office, you will want to add a separate business phone line with voice mail.

Get a Simple Yellow Page Listing.
Most people use internet searches to find local companies these days, but you might benefit from having a listing under Real Estate Management.

Purchase office equipment/tools.
A business level computer, calculator, word processing and spreadsheet software (like Microsoft Office Professional). Here’s where you will spend some of the budget you planned for in the previous blog.

FREE Download:
Download this FREE customizable sample community management contract to help protect your business!

Get off on the right foot with your new community association management company with this Sample Management Agreement from TOPS Software. This contract provides a framework for the most common elements of a management contract.

While this agreement is specifically written to help protect you from arbitration, you should not use the contract directly without first consulting a local lawyer versed in community association law. This is vital to the success of your contract, as all states and principalities have different laws governing community associations that may not be fully represented in this sample agreement.

Unlike other ‘blank check contracts, this agreement is specifically written for Condo / HOA / Community Association management, including such provisions as:

  • Deed restriction enforcement
  • Bank account management
  • Common area maintenance
  • Governmental compliance
  • Collection of assessments
  • Assessment Certificates
  • Dispersement of Funds
  • Contracting authority
  • Insurance oversight
  • Owner Complaints
  • Unit maintenance
  • Budgeting

This is the resource you’ve been waiting for.