What is the primary purpose of a property management agreement?

The primary purpose of a property management agreement is to outline the responsibilities and obligations of the parties involved. This formal document serves as a contractual relationship between the property owner and the property management company, defining each party's roles in managing the property. It specifies what the property manager is responsible for, such as marketing the property, screening tenants, maintaining the property, collecting rent, and managing finances. Additionally, it delineates what the property owner is expected to provide, ensuring both parties have a clear understanding of their commitments.

This agreement is critical in establishing the terms under which the property will be managed, including how disputes will be resolved and the financial arrangements between both parties. While market value and rent prices can be relevant to overall property management, they are not the core focus of this agreement. Similarly, while tenant behavior rules may be articulated in lease agreements, they are not the primary function of a property management agreement, which is centered on the relationship between the owner and manager.