What should I charge for property management splits? I have an agent who wants to manage properties. I'm comfortable supervising him because in my past life I managed over 300 units. I have asked him to get his CPM designation. Considering I will be taking on substantial additional risk, extra accounting, and 2 extra bank accounts-what would be fair? I hate to take much of split from the measly $80- $100 per month per property property managers get, but I also need to make sure it's worth my risk and time. Any thoughts? (I also posted this in the broker/agent forum).

Carla,

Another thought. I would set up your property management division as a seperate corporation or LLC.

The reason is liability. You don't want your main brokerage at risk if you get sued.

At least that is my opinion.

Our Broker is set up that way and is the best way to go for protection.

I would also like to add which is not mentioned that to add property managment is going to make your e&o policy go through the roof because of the high frequency of lawsuits that occur by the renters,plus your existing agents are not going to want to pay a higher e&o premium when they don't do property management just regular sales.

What our broker did is set-up as a seperate llc company and has a seperate e&o policy for the property management.This way it does not effect the low cost E&O to regular agents and if the property management gets sued and loses she can dump that company off without effecting the main brokerage.

Thanks! I was planning to set up a seperate LLC. Our E&O coverage must work a little differently here. Each agent gets their own E & O insturance. The property management rider is an additional $150 per year for the brokerage, and the fair housing rider is $20 per year. Same cost for any induvidual brokers (we don't have agents here- no sales license level...) who want to manage properties.

In KY only the broker can do property management. So I'm of no help.

I am thinking of doing the same thing here in Ohio. Why do you need two seperate Bank Accounts? I know you need one for The Trust Account.