Licensed Property Management
Recently I was engaged online with a party discussing the requirements of being licensed in BC. The discussion started with a post online about someone’s strata corporation having a bylaw that stated "Unless with written approval from the Strata Council, rental unit must be managed by Licensed Professional Rental Property Manager."
The person was asking “does this mean I must hire a property manager”
With regards to these bylaws we were recently advised through training offered by the governing authorities in BC that it would not be enforceable, as an individual is entitled by law to manage their own rental property.
I proceeded to explain that once you compensate another party to manage your rental, that party must be licensed to manage the rental property. A response suggested that “someone can manage properties for a single owner and not be licensed. Other exemptions are developers”
There are exemptions for parties to manage rental properties in BC. For developers they are exempt becaue the developer’s employee is the party managing the property. This can be for any rental, if an entity owns the property, any of its employees may manage that property without being licensed. There are other exemptions as well including, but not limited to persons acting under authority of the court, a trustee in bankruptcy, an executor of an estate are few other exemptions.
If the owner of a rental property hires another person or company to manage their property and they compensate them, and the individual or company is not part of the exemptions then the party must be licensed in order to provide rental management services. Why is it important for parties to be licensed to manage rental properties for other people and or companies. Licensing provides a source of education of the rental laws and should improve the experience for owners and tenants when renting a rental property. Licensed property managers are expected to maintain a higher standard of professionalism when providing rental management services to their clients and tenants. Licensing provides tenants and owners a recourse of filing complaints and or recoveirng costs through systems like the Real Estate Compensation Fund to provide protection for clients in the event they have lost money due to the actions of licensed professionals.
Many concerns with landlords having negative experiences with tenants often occurs from a landlord who is lacking education of the rental laws in BC. In any endevour if you are unaware of your requirements it will lead to an unexpected outcome. Being a landlord in BC is a complicated and time consuming process. Operating a rental property is comparable to operating a business, and should be viewed in that manner. Many landlords fail to take the business approach to managing a rental property. Meaning you should follow the laws required for managing your rental property. Failing to follow the laws provides opportunities for unethical tenants to take advantage of uneducated landlords.
If you need assistance managing your rental property in the lowermainland of BC Cartref Properties can help you have a positive experience.
Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
A tenancy should be a positive experience for both the landlord and the tenant.
How can you achieve a positive tenancy for both the Landlord and the Tenant.
Both parties should be trying to create a win-win situation. When either party is trying to create a win-lose situation, it often ends in a negative tenancy.
A positive tenancy starts and ends with effective communication between both parties.
Communication starts with the advertising of the property. Don’t mislead prospective tenants with photos that missrepresent the condition of the property. If the photos are not realistic, when the parties arrive to view the property they will see it isn’t what they expected and question other information provided by the landlord. If there are repairs required, fix them. It is unfair to expect a tenant to live in a property that has items that are not functioning properly. Tenancy laws in BC require landlords properties meet health safety and housing standards.
When prospects are viewing the property, clearly explaining the time for the viewing and asking them to confirm the appointment, is a way to begin positive communication. Potential applicants who miss-communicate during this process may be a sign of a potential negative tenancy.
When prospects are applying for the rental, inform them of the process and how it works, how long it will take to complete the process. Clearly explain what information is required when applying for the property. Explain the process of moving in and obtaining the keys for the property. Explain the requirement to perform the move in-inspection report and when it is used at the end of the tenancy, when deposits and rent will be required to be paid. How you will collect rent during the tenancy.
During the viewing explain to applicants when and how frequently you will be inspecting the property during the tenancy. Explain the process for tenants to report issues and concerns to the landlord. We find the more communication we provide to applicants the more information they provide us, a win-win.
During the tenancy communicate effectively and within the requirements of the tenancy laws when access is needed to the property. Access may be required for inspections, repairs or other reasons. Respond in a timely manner to tenants’ concerns over potential repairs. Be proactive on performing repairs instead of waiting until they are necessary. Preventive maintenance is more cost effective.
At the end of the tenancy provide clear instructions on the expectations and requirements when the tenant is vacating the property. Many tenants miss understand the move out process and want to perform the move out inspection before all their belongings have been removed from the property. When they understand the process the experience is a positive one.
Effective communication eliminates many issues between tenants and landlords, resulting in a positive experience for both parties.
Need assistance to have a positive experience renting your property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
Rental Management only
Cartref Properties provides rental management services only. In BC a real Estate brokerage is able to provide three different types of services, Rental Management, Strata Management and Real Estate Sales. In order to provide these services the brokerage must be licensed to provide whichever service they are offering. We only offer rental management service even though we are licensed for strata management services, why? There is a natural conflict of interest between the three categories, especially with rental and Strata Manager. If a company manages the entire strata and then manages a rental in that same building, they are required to identify one of the clients as the primary client. This means if there is a conflict of interest between the two parties they are only able to represent one party. This would happen when a bylaw infraction occurs. In all cases a management company will select the strata client as the primary and the rental client as the secondary. The real Estate council in BC highly recommends companies who manage a strata corporation don’t manage rental units in the same building. We also have no interest in providing sales service for the same issue. We don’t want to be the real estate agent who is looking for a listing in a hot market and asking you to sell when you’re not interested in selling. Cartref Properties wants to be able to provide property management services to our clients throughout the entire time we are engaged as your property manager, which is why we only provide rental property management services.
Need assistance managing your rental property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
Real Estate Service Rules “Office Signage Required”
Cartref Properties started operating in March of 2020, the same day the pandemic started. Cartref Properties is a licensed brokerage providing rental property management services to investor owners specialising in products located in Strata Corporations.
In order to operate a licensed property management company in BC one has to obtain the proper licensing from BCFSA. Every brokerage must have a Managing Broker who is actively engaged in the management of the business, and may only offer the services the brokerages have licensing for. There are three forms of licensing under BCFSA. Sales which is referred to as Trading, Strata Management which is the management of Strata Corporations and Rental Management which can include rental building management and individual unit management.
BCFSA has many rules and regulations agents, brokers and brokerages must adhere to while operating their business called the Real Estate Service Rules. When I was opening my brokerage I would indicate to friends who owned different types of businesses about a particular rule in the Real Estate Service Rules. Rule 36 requires all brokerages to display a business sign at the entry of the building where the brokerage head office is located. Friends would say I am not required to have that and I had to explain it is a specific rule to the Real Estate industry.
The reason for the rule is to clearly identify for the public that a real estate brokerage is located at the brokerage’s address location. This is to help protect the public from business opening in locations where it is difficult for the public to access. Home based businesses are permitted if they meet the requirements, though they must still meet the sign requirement at the entry of the property. By requiring the brokerage to have signage at the entry of the building it adds professionalism to the industry. Whatever building the brokerage head office is located in the name of the business must be displayed on the building directory.
When searching for a property management company it is important to select a company to represent you who is following the rules and regulations to ensure your property is not subject to claims of impropriety. If your property management company doesn’t have their business sign at the entrance of the building where the office is located they are in violation of the Real Estate Service Rules. BCFSA’s website has a section where the public can identify if their property manager is licensed and this will also indicate the location of the brokerages office. This service makes it easy for the public to visit the location of the brokerage to identify if the company exists.
Licensed property managers must take law full direction from their clients when performing their duties. If a brokerage is violating the Real Estate Service Rules, how are they going to manage your property, what other rules may they choose not to follow, and how will that affect your property.
Cartref Properties is located at 310-220 Brew Street In Port Moody
Need professional assistance managing your rental property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
“How much do you have in the trust account for me?”
When hiring a property manager to manage your rental property there are many things you should look for. One key factor is how are they handling your money?
I was reading a decision in BCFSA regarding the Special Compensation Fund, (link is below) where the party involved stated they were unaware of exactly how much money he owed to his clients. What is the Special Compensation Fund you ask?. When funds by a Property management company or Real Estate company are held in trust the interest earned is deposited in a fund Called the Special compensation fund. Interest earned on funds held for security deposits is not part of this fund as that interest may be owed to the tenant. This fund is a source for clients to recoup funds they may have been owed by the agent due to misappropriation of the funds.
All Licensed Property Managers in BC are governed by the same authority which is BCFSA and must follow the same rules and legislation. The real estate service rules has a section on the requirements every brokerage must adhere to when handling client funds. With Rental Property Management the rent and security deposits collected can be held in an account on behalf of the client or a pooled trust account. In either case the brokerage is required to keep records of all transactions in and out of the accounts, and for the pooled trust account keep a separate ledger of the transactions for each client.
The reasoning for the brokerage above identifying they were unaware of the amount of funds they had for their clients was due to them moving funds from the trust account to their general account to pay company expenses. This is a clear violation of the rules regarding management of the funds.
When hiring a property management company always request or demand a monthly statement of the activity at your property. This statement should clearly show the funds coming in and the expenses coming out of your account. It would also show you a balance of the funds held at the brokerage in your name. If you are not receiving a monthly statement, it is possible your property manager is not following the rules regarding managing your money, they might not be licensed most importantly you need a new property manager.
An interesting read click below
https://www.bcfsa.ca/media/3119/download
Need assistance managing your rental property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com