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(This was originally posted on www.brentdavies.com as If you property manager isn’t licensed, your money isn’t safe.) Barry McGuire mentioned this during the ACRE weekend in Edmonton this past weekend.
Many people don’t realize that property managers need to be licensed by the Real Estate Council of Alberta (RECA). When you’re considering a property manager, take the time to check your property manager’s licensing status. You can do this on RECA’s website.
If you’re in a Joint Venture (JV) Partnership as the Real Estate Expert and you use a non-licensed property manager it`s possible that you can be held liable for any losses. Working with professionals is an important part of your Real Estate Investment Business.
What license does a property manger need?
A property manager holds security deposits from your tenants. To be able to hold security deposits for someone else, they need a Broker’s Trust Account. Only a RECA certified broker can hold security deposits and rents from your tenants. There can also be a staff of property managers working under the broker, and they must be licensed as associates.
You need to check that your property management firm has a registered broker in good standing. You should ask them at the outset, but you should also do your own due diligence.
How Do I Use RECA to check on my Property Manager?
We’re going to start by checking out our friend Barry McGuire of the Ritchie Mill Law Office. He’s a lawyer and doesn`t have or need a real estate license. We shouldn’t be able to find him.
1. Go to the RECA website, www.reca.ca.
2. You want to click on Consumers and then we’re going to find the license search link in the top right.
To go straight to the search function click here.
3. Now there’s three options to search: last name, brokerage name and location. There are also some wildcard options if you’re not quite sure where you’re looking.
We’re going to start by searching for McGuire. Put the name in the first box and click the little globe button.
4. You’re going to get a result like this one below. You’ll notice there are no entries matching Barry McGuire or the Richie Mill Law Office. If Barry was claiming to be a property manager, we’d have a pretty big red flag.
5. Now we’re going to do the same thing again for myself (Brent Davies). We’re also going to use the wildcard function. Because some people spell Davies without the ‘e’ (Davis) we’re going to search for both of them by using the % wildcard. There’s an explanation of how to use these on the RECA search page.
The search result you will see will have a listing on it like this:
6. The second listing down is William Brent Davies. It tells you he is the broker for Davies Management & Realty, and his license is valid until September 2009. Your property management company must have a broker listed for that company, and they must have a little green circle next to them. The other options are a grey or black circle, and those should raise some red flags. If they’re not listed at all, they need to prove to you that money will be handled through an authorized broker’s trust account.
Other possible red flags that your Property Management firm might not be licensed:
- Mailing address is a post office (P.O.) box.
- Requesting payments (cheques or money orders) in a personal name or a name different than what’s on the license or management agreement
- Advertisements in a different name. This property manager is in a grey area and may be playing for multiple teams.
Where else should I look?
It’s also a great idea to check the Better Business Bureau (BBB). Good property managers also tend to be good corporate citizens. Make sure your property manger can provide good references, interacts with you in a professional way and is properly licensed.
Many people don’t realize that property managers need to be licensed by the Real Estate Council of Alberta (RECA). When you’re considering a property manager, take the time to check your property manager’s licensing status. You can do this on RECA’s website.
If you’re in a Joint Venture (JV) Partnership as the Real Estate Expert and you use a non-licensed property manager it`s possible that you can be held liable for any losses. Working with professionals is an important part of your Real Estate Investment Business.
What license does a property manger need?
A property manager holds security deposits from your tenants. To be able to hold security deposits for someone else, they need a Broker’s Trust Account. Only a RECA certified broker can hold security deposits and rents from your tenants. There can also be a staff of property managers working under the broker, and they must be licensed as associates.
You need to check that your property management firm has a registered broker in good standing. You should ask them at the outset, but you should also do your own due diligence.
How Do I Use RECA to check on my Property Manager?
We’re going to start by checking out our friend Barry McGuire of the Ritchie Mill Law Office. He’s a lawyer and doesn`t have or need a real estate license. We shouldn’t be able to find him.
1. Go to the RECA website, www.reca.ca.
2. You want to click on Consumers and then we’re going to find the license search link in the top right.
To go straight to the search function click here.
3. Now there’s three options to search: last name, brokerage name and location. There are also some wildcard options if you’re not quite sure where you’re looking.
We’re going to start by searching for McGuire. Put the name in the first box and click the little globe button.
4. You’re going to get a result like this one below. You’ll notice there are no entries matching Barry McGuire or the Richie Mill Law Office. If Barry was claiming to be a property manager, we’d have a pretty big red flag.
5. Now we’re going to do the same thing again for myself (Brent Davies). We’re also going to use the wildcard function. Because some people spell Davies without the ‘e’ (Davis) we’re going to search for both of them by using the % wildcard. There’s an explanation of how to use these on the RECA search page.
The search result you will see will have a listing on it like this:
6. The second listing down is William Brent Davies. It tells you he is the broker for Davies Management & Realty, and his license is valid until September 2009. Your property management company must have a broker listed for that company, and they must have a little green circle next to them. The other options are a grey or black circle, and those should raise some red flags. If they’re not listed at all, they need to prove to you that money will be handled through an authorized broker’s trust account.
Other possible red flags that your Property Management firm might not be licensed:
- Mailing address is a post office (P.O.) box.
- Requesting payments (cheques or money orders) in a personal name or a name different than what’s on the license or management agreement
- Advertisements in a different name. This property manager is in a grey area and may be playing for multiple teams.
Where else should I look?
It’s also a great idea to check the Better Business Bureau (BBB). Good property managers also tend to be good corporate citizens. Make sure your property manger can provide good references, interacts with you in a professional way and is properly licensed.
