Many think of real estate agents as working with individual buyers and sellers of homes, but in reality, there is a massive market for agents that assist landlords with their investment properties.
A management agreement in real estate means the agent takes on a lot of the work with property management as well as finding new tenants to fill vacancies. However, what happens when the agent/ landlord relationship isn’t working out? It’s important to know all the relevant rights and procedures to make sure a switch is done by the book.
What services do real estate agents provide?
For starters, let’s run through a few of the services a buyer’s agent would perform for a landlord.
- Marketing a property.
- Scheduling viewings with possible tenants.
- Handling the logistics of renting.
- Some agencies are willing to do more, but you’d need to ask.
Why might a landlord decide to change agents?
Many might assume landlords change their agents due to a failure on the agent’s part, but that is not always necessarily the case. Aside from a failure to properly perform their duties, other causes include:
- A desire to work with someone cheaper.
- Property owners deciding to take on the management work themselves.
- Owners with multiple properties trying to consolidate the management to make things easier.
What are the landlord’s rights?
When talking about letting agent contract termination, the landlord has certain rights. For the most part, the landlord is in the driver’s seat in terms of control. Whether there’s an exclusive or non-exclusive agency agreement, the landlord can generally terminate a relationship with written notice. This is especially easy if you stick to your state REI agreement.
How to terminate a real estate agent agreement
The process begins with providing written notice to the agent, generally 30 days in advance. Some older forms require you to take 90 days, so be aware. After this, you want to make sure any tenants affected by the change are aware. After this, make arrangements to get the key and file from their office, and the relationship is formally ended. At that point, you can start looking for a new agency.
What are the agent’s rights?
Agents also have their fair share of rights, especially in the event of unexpected contract termination. If an exclusive management agreement is in place, they can’t be terminated until the end of said agreement without charging added fees. In addition, it’s a basic custom for the landlord to provide some sort of explanation to the agent as to why they are seeking a termination.
Real estate agents need to build up relationships with different professionals and clients in order to succeed, but equally important as an agreement between the landlord and agent is the agent having resources to do their job. One such example is using a telemarketing database. Sometimes, in the event of a property manager breach of contract, you need to sever ties with that client and pursue other credible leads. These resources are great for finding new landlords that can make use of your services.