Hand over the keys. Keep the authority
in writing.
Engage a property manager with the two terms every dispute turns on made explicit — how the fee is calculated, and how much the manager may spend before asking you. Plus duties, funds handling and a clean exit.
- Percentage or flat fee
- A spending ceiling you set
- ESIGN & UETA valid
How it works
From answers to a signed management agreement — in about two minutes
- 01
Name the owner, the manager and the property
The registered entity on each side — not a trading name — then the address of the property being handed over and the day the manager takes it on.
- 02
Set the fee and the spending ceiling
A percentage of rent actually collected or a flat monthly amount, an optional leasing fee for each new tenancy placed, the per-occurrence repair ceiling above which you must be asked, and the notice either side needs to walk away.
- 03
E-sign & download
Owner and manager each sign, legally valid under ESIGN/UETA. Download the PDF and keep it with the property file alongside the leases and the insurance.
Last updated August 20, 2026
Written by LawLease EditorialReviewed by LawLease Legal Team
By document
Which document you need
This one is easy to mistake for a lease, and it is not one. A management agreement is between the owner and the manager; no tenant is a party to it and it gives nobody the right to occupy anything. The tenancy is a separate document signed with the tenant — often by the manager, on the owner's behalf, under the authority this agreement grants.
- RL
Residential lease agreement
The document the manager actually signs with each tenant, built on the law of the state the property sits in.
Learn more - TW
Tenant welcome letter
Rent, utilities, maintenance and emergencies in one letter, so a new tenant's first week doesn't arrive as phone calls.
Learn more - PO
Proof of residency / rent verification letter
The letter lenders, agencies and new landlords ask for — residency, rent and payment standing, verified.
Learn more - LA
Lease amendment
Change a tenancy that is already signed — the rent, the term, a name on it.
Learn more - CL
Commercial lease agreement
Office, retail or light-industrial space let to a business — a different body of law entirely.
Learn more
What is a property management agreement?
A property management agreement is the contract by which an owner engages someone else to run a rental property day to day. It names the two parties and the property, sets out what the manager is authorised to do — advertise and show it, screen applicants, sign leases on terms the owner approves, collect rent and deposits, serve routine notices, arrange repairs, keep the books and report at least monthly — and then fixes the two numbers that settle almost every argument that follows: what the manager is paid, and how much the manager may spend without asking.
It is not a lease and it creates no tenancy. No tenant is a party to it, and nothing in it changes what a tenant is owed under their own lease or under state law. It is an agency agreement: the manager acts for the owner and, in most states, needs a real-estate licence to do that for a fee. The owner stays the landlord — named on the lease, named in the deposit statute, and answering for a fair-housing complaint if one is ever made. What this document does is bound the manager's authority and price it. It is also called:
- Property management agreement
- Rental management agreement
- Owner–manager agreement
- Real estate management agreement
- Management contract
- Landlord property manager agreement
This agreement engages the manager; it houses nobody. Each tenant still needs a tenancy of their own — usually signed by the manager on the owner's behalf, under the authority Section 2 grants. Build it with the residential lease agreement so it carries the disclosures, deposit rules and notice periods of the state the property sits in.
Legal considerations
Two things about this document are easy to get wrong, and both are about who is on the hook. The first is licensing. In most states, managing rental property for someone else for compensation — advertising it, showing it, signing leases, collecting rent — is real-estate brokerage, and doing it unlicensed can cost the manager the fee and invite penalties on top. Narrow exemptions exist, commonly for a salaried resident manager or for someone managing property they own themselves, and they vary state to state. Section 8 has the manager represent that it holds whatever licence the state requires; an owner should verify that representation rather than take comfort from it.
The second is that delegating the work does not delegate the liability. The owner remains the landlord: bound by the lease, named in the deposit statute, and answerable for a fair-housing complaint arising from how the manager advertised, screened or showed the property — vicarious liability for an agent's acts is the rule, not the exception. This agreement allocates responsibility between owner and manager, and that allocation is real between them. It is invisible to the tenant, who deals with the lease and with state law. Which is exactly why the fee basis, the spending ceiling and the funds clause repay reading properly: they are the levers you actually control.
2 terms
the fee basis and the repair ceiling settle most owner–manager disputes
Most states
require a real-estate licence to manage property for someone else for a fee
14 days
to hand back funds, keys, leases and records once the agreement ends
- Collected rent, not billed rent
- A percentage fee should be calculated on rent actually collected, which is how this agreement writes it. Charged on billed rent, the manager earns the same whether the unit is let or empty and whether the tenant pays or not — precisely the months you want them working. Percentages commonly run 8–12% of collected rent on single-family and small multifamily; a flat fee suits a stable single unit, where the work does not scale with the rent.
- The repair ceiling is a spending limit, not a maintenance standard
- Ordinary repairs up to the amount you set go ahead without asking. Anything above it needs your approval, except a genuine emergency threatening life, safety or the property, where the manager acts first and tells you promptly. Set it too low and you will be approving smoke-alarm batteries at midnight; set it too high and you will first hear about a costly decision when the monthly statement arrives.
- You are still the landlord for the deposit
- Deposit statutes generally bind the landlord named on the lease, and they keep binding you whoever is holding the money. Section 5 requires the manager to keep funds separate from its own — several states go further and require a broker trust account — and to hold and return deposits as the lease and the law require. If the manager gets it wrong, the tenant's claim is usually still against you.
- Fair housing follows the agent back to the owner
- Advertising, screening and showing decisions made by a manager are ordinarily attributed to the owner under the Fair Housing Act. Agreeing written screening criteria before the first applicant, and requiring the manager to apply them consistently to everyone, is worth more than any indemnity clause you could add afterwards.
- Independent contractor, not employee
- Section 8 says so, and the arrangement should look like it: the manager chooses its own methods, works for other owners, and is paid a fee rather than a wage. A resident manager whose hours you set and whose work you supervise is likely an employee instead, with payroll tax, wage-and-hour and workers' compensation consequences this document does not address.
- Read the termination clause before you need it
- Notice in writing, either way; obligations already accrued survive; and everything — funds, keys, leases, tenant records and deposit ledgers — comes back within 14 days. Manager-supplied forms often add an automatic renewal, a cancellation fee, or a commission that keeps running on tenants they placed. This one carries none of those, and if you are handed one that does, that is the clause to negotiate.
How to write a property management agreement
Six steps take an empty form to a signed engagement. Two of them carry most of the weight — the fee and the ceiling — and both are worth slowing down on.
Whoever is named is who is bound. A management company's trading name is not a party.
- The registered entity name on each side, not a DBA
- Ask for the manager's real-estate or property-management licence number and check it with the state
- Confirm the person signing has authority to bind the company
Free sample management agreement
Here's the wording before you start — the same clauses the generator produces, with the figures left blank. The duties list and the general provisions read much as they do in any services contract, so the preview skips to the sections an owner and a manager actually argue over. Section 4 is shown in its percentage wording; the generator writes it two ways.
Property Management Agreement
1. PARTIES AND PROPERTY. This Property Management Agreement (the “Agreement”) is entered into between (“Owner”) and (“Manager”) for the management of the rental property at (the “Property”), beginning and continuing until terminated under Section 7.
3. REPAIR CEILING. Manager may arrange ordinary repairs and maintenance up to per occurrence without Owner’s prior approval. Repairs above that amount require Owner’s approval, except in an emergency threatening life, safety or the Property, where Manager may act first and notify Owner promptly.
4. COMPENSATION. Owner shall pay Manager a management fee equal to % of rent actually collected each month, plus a leasing fee of for each new lease signed. Fees may be deducted from collected rent before remittance.
5. FUNDS. Rent, deposits and other funds Manager holds for Owner shall be kept separate from Manager’s own funds, in the manner state law requires (including any trust-account requirement), and remitted to Owner monthly with the statement, less fees and approved expenses. Security deposits are held and returned as the lease and applicable law require.
7. TERMINATION. Either party may terminate this Agreement on days’ written notice. Termination does not affect obligations accrued before it takes effect; on termination Manager shall deliver to Owner all funds, keys, leases and records relating to the Property within 14 days.
Handing a property to a manager?
Real humans read every message — whether it's about where to set the repair ceiling, what the licence rules are where your property sits, or which fee basis fits a single unit. For a large portfolio or an unusual arrangement, get a lawyer on it.