Out‑of‑State Owner in Philly — Managing Agent Requirement? How To Handle This?

Question

Hey everyone,

I’m based in NYC and just bought my first rental property in Philadelphia (Fishtown). While going through the process of getting my rental license set up, I ran into something I didn’t expect:

If the owner lives outside Philadelphia, L&I requires you to list a managing agent with a Philadelphia mailing address on the rental license application.  
The agent becomes the point of contact for L&I, but the owner still holds the license and all legal responsibility.

1. Is there a way to avoid this?

2. If I was to play by the rules, what would it cost to get an agent? I guess all they do it receive mail and notify me "if" I was to receive mail from the city.

Stuart Udis · Answer

Plaintiff attorneys in Philadelphia will have a field day with a premises liability claim where a dangerous and defective condition causes injury if there is no real hands-on local management, especially where the so-called rental license representative was merely paid a nominal $450 to fill the role, To @Kevin M.'s point, anyone with a business and reputation worth protecting won't get involved in this type of service. It's similar to the contractors who charge a fee to pull permits for unlicensed contractors.

Drew Sygit · Answer

Becoming more & more common - why do you think?

If OOS owners actually kept their properties up to code, why would the city want to do this?

Here in Metro Detroit, the "agent" for the owner can actually have tickets written in their name and if not addressed, arrest warrants issued.

Ferdia Kenny · Answer

@Michael K Gallagher I was able to resolve it. I was able to pay a managing agent $450 just to use their name and address - I feel like I was robbed, but it's one more problem that has disappeared.

So you're saying that this happens in your city too (Columbus OH)? I am potentially thinking of buying in that area next.

Alan Asriants · Answer

Unfortunately this new License rule is such a load of crap. Its their way to mitigating out of state investor who don't take care of property.

The worst part about this - is that it HAS to be a Phila Address.

I own property in NE Phila and live in Bensalem - I cannot use my Bensalem address - even though I am 10-15min away by car!

However if I lived in SW Phila - 1.5hours during rush hour - that's totally fine.

The best solution is to: Use a family member or friend, or ask your agent if they are willing to forward you mail for a small fee.

Ferdia Kenny · Answer

@Placeholder Placeholder what are you selling?

Kevin M. · Answer

@Ferdia Kenny it's more than just selling your name and address though. The agent does take on responsibility and potential liability. We are a professional management company in Philadelphia and I would not 'sell our name and address' for $450 like that for an operation over which I have no control.

Michael K Gallagher · Answer

@Ferdia Kenny not sure what the specific rule are but I've run into something similar with some of my out of state clients, they tend to either just use the attorneys office that they are using to make the LLC or if that's not applicable we have sometimes been their agent for them and just used the office address.  generally it only seems to show up on the "rental" tab of the auditor's site from what I've seen.

Ferdia Kenny · Answer

@Alan Asriants Thank you for this. What a ridiculous rule. It should be if you are outside of a much larger radius. I live in NYC and I don't think I'll have any issue self-managing. I was able to resolve the problem by paying $450 to someone that specializes in this niche service, called "Philly Rental License". I would do the same business if I did live in Philly - selling my name and address = simple money. Unfortunately, I will need to pay them again if I want to use them for another property in Philly. If you know someone willing to do it for cheaper, let me know.

Out‑of‑State Owner in Philly — Managing Agent Requirement? How To Handle This?

Most Popular Reply