Setting up a New Property Management company in Columbus Ohio

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Setting up a New Property Management company in Columbus Ohio

Philip Cutting
Virtual Assistant · Reynoldsburg, OH · Member since 2014 · 66 posts · 23 votes

Hi guys,

I run a management company for my own properties.  But as my portfolio is getting larger I'm looking to take that part of my business more seriously.  My long term goal is to have 1000's of unit's anyways, so I need to eventually get that set up.  

My understanding is that to have a property management company in Ohio that services properties that you do not have ownership interest in, you have to be a Real Estate Broker.  

Question 1) If you are subletting properties, ie, you have a lease that lets you re rent out properties, do you have to be a broker?

Question 2) Can you run a property management company as a RE Sales agent?

Question 3) Can a company hire a broker to satisfy the requirement?  If so, how involved does the broker have to be? I understand a broker can probably only work for one company and not work for his own brokerage and a property management company as the broker of record?  What would reasonable compensation for a broker be?

Question 4[this probably requires a separate question]) How to really set yourself ahead of others in the area?  What systems/software would be good to use and how to build market share?

Thanks

Phil

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Darrin CareyPro Member
Lender · Dayton, OH · Member since 2008 · 1k+ posts · 705 votes
12y

@Philip Cutting 

Here are some short and simple answers. Some of these have been said, but I will consolidate them here.

  • You must be a licensed Agent or Broker to manage someone else's property.
  • A Broker can only hang their license with one company. 
  • An Agent can only operate under one Broker.
  • An Agent can do Property Management if the Broker/Company allows it, and is set up correctly for it.
  • You do not have to be a Broker to own a Real Estate Agency or Property Management Company. A Broker must oversee all licensed activity. The owner is responsible for business activity, and must be very careful not to act as a Broker if they are not a Broker.
  • An assistant can help, but there are limits. See this article from the Ohio Division of Real Estate for specifics. http://www.com.ohio.gov/documents/real_2008Summer....
  • If you have a Master Lease with the right to sublease on a property, you can sublet the units without being an Agent of Broker. Be careful, depending on the details, this could go either way. That's a whole different discussion.
  • Both Buildium and Appfolio are good.
  • A local Property Manager went from 20 to almost 200 units in about 2 years, with almost zero advertising. Almost all referrals.

Hope that helps. Good Fortune.

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  • Steve Baldwin
    Rental Property Investor · Columbus, OH · Member since 2012 · 181 posts · 51 votes
    12y

    Good morning Phil, 

    It was my understanding that you need to be a licensed agent just to be a property manager for your own or for someone else's properties in Ohio. I do not see any issue with running a property management company as a agent only and do not see why you would have to hold a broker's license. @peterlohman?

    Currently, we are using trello.com (FREE!) which is a online project management company. Very easy to use and sends out tickets to contractors, managers, etc. They also have a very user friendly app for smart phones.

    I strongly believe in owning your own property management company for larger number doors. This frees up your time for financing, finding deals and purchasing.

    When are you coming to Columbus? Id love to chat with you on how we are structuring our company and our game plan! Sounds we have a very similar approach!

    Thanks bud,

    Steve

    0Reply
  • Peter Lohmann
    Property Manager · Columbus, OH · Member since 2012 · 309 posts · 275 votes
    12y

    The Ohio Division of RE requires that all property management companies (other than those strictly managing the properties that they own) must be operated with licensed RE agents, and under the direct supervision of a RE broker. That broker cannot be affiliated with any other brokerages.

    The Division strongly discourages "Rent-A-Broker" situations, so you can attempt that at your own risk I suppose.

    1Reply
  • Philip Cutting
    OP
    Virtual Assistant · Reynoldsburg, OH · Member since 2014 · 66 posts · 23 votes
    12y

    Hi @Steve Baldwin 

    I'm still working on my plans but I plan to be there around the 18th of Aug.  I'll call you when I know the actual days I'll be there and I hope to have a couple drinks :) I'm looking forward to putting our heads together.

    I use trello with my teams.  It's a pretty cool program for exactly what you mention.  My weakness is that I use quickbooks.  It's nice because it's a solid double entry accounting system with automatic billion options, but it is week with customer access and collaboration.  I'm considering using swizznet.com with quickbooks for each customer, but that doesn't allow for good agregate reports and is only good for up to like 100 units before it gets too hard to manage (hopefully someone will disagree).  I'm considering Buildium and appfolio, but appfolio is pretty expensive if you don't have 200 units under management.  I don't know how long it would take me to scale up to 200 units under management.  

    Phil

    0Reply
  • Steve Baldwin
    Rental Property Investor · Columbus, OH · Member since 2012 · 181 posts · 51 votes
    12y

    I have heard good things about Buildium. Heard about them on the podcast as well.

    Ill have to bring along my partner for the drinks, he will be handling that aspect of our business.

    @Joe Holloway 

    1Reply
  • Philip Cutting
    OP
    Virtual Assistant · Reynoldsburg, OH · Member since 2014 · 66 posts · 23 votes
    12y

    Hi @Peter Lohmann 

    Thanks for taking the time to answer my question!

    I'm a little confused with the Licenced agents under the supervision of a broker part.  One broker can only hang their hat at one business from what I understand.  I guess that means that agents can't hire a broker from another agency/company to supervise them? I ask, because soon my wife and probably myself are going to get our sales agents license.  We both have the other educational requirements to be a broker, but need the time and closing requirements.  

    As a property manager how have you coped with this? Were you working from 2008 to 2013 to get your broker's license?  

    What was the hardest part of growing your business in columbus?

    What are the roles that an agent or broker has to perform? Can an assistant sign leases with the tenants, do showings, set up marketing?

    Thanks

    Phil

    0Reply
  • Peter Lohmann
    Property Manager · Columbus, OH · Member since 2012 · 309 posts · 275 votes
    12y

    Hey Phil - I recommend you talk with the Ohio Division of RE about your questions. They will be happy to answer them and will have more concrete information than myself.

    As far as how we succeeded in starting and growing our PM company here in Columbus, I'm not super comfortable sharing that information with someone who has plainly stated they intend to compete with me :) I hope you understand.

    Regards,

    Peter

    1Reply
  • Philip Cutting
    OP
    Virtual Assistant · Reynoldsburg, OH · Member since 2014 · 66 posts · 23 votes
    12y

    @Steve Baldwin 

    Excellent, I'm excited to meet both of you!

    Phil

    0Reply
  • Philip Cutting
    OP
    Virtual Assistant · Reynoldsburg, OH · Member since 2014 · 66 posts · 23 votes
    12y

    @Peter Lohmann 

    I understand.  I've had great experiences in working with other landlords and professionals in my field in other communities.  Perhaps Columbus is really competitive. I hope that you and I have so much business that we find ourselves competing with each other from time to time!  At that point we both should have multimillion dollar businesses!

    Thanks and good luck!

    Phil

    0Reply
  • Steve Baldwin
    Rental Property Investor · Columbus, OH · Member since 2012 · 181 posts · 51 votes
    12y

    @Philip Cutting So if you were with Remax, you could manage other people properties or your own.

    The broker there would supervise. Our office will even go as far as taking care of things like booking and some admin. (for a fee)

    1Reply
  • Philip Cutting
    OP
    Virtual Assistant · Reynoldsburg, OH · Member since 2014 · 66 posts · 23 votes
    12y

    When I come we will definitely talk about this @Steve Baldwin !!

    1Reply
  • Darrin CareyPro Member
    Lender · Dayton, OH · Member since 2008 · 1k+ posts · 705 votes
    12y

    @Philip Cutting 

    Here are some short and simple answers. Some of these have been said, but I will consolidate them here.

    • You must be a licensed Agent or Broker to manage someone else's property.
    • A Broker can only hang their license with one company. 
    • An Agent can only operate under one Broker.
    • An Agent can do Property Management if the Broker/Company allows it, and is set up correctly for it.
    • You do not have to be a Broker to own a Real Estate Agency or Property Management Company. A Broker must oversee all licensed activity. The owner is responsible for business activity, and must be very careful not to act as a Broker if they are not a Broker.
    • An assistant can help, but there are limits. See this article from the Ohio Division of Real Estate for specifics. http://www.com.ohio.gov/documents/real_2008Summer....
    • If you have a Master Lease with the right to sublease on a property, you can sublet the units without being an Agent of Broker. Be careful, depending on the details, this could go either way. That's a whole different discussion.
    • Both Buildium and Appfolio are good.
    • A local Property Manager went from 20 to almost 200 units in about 2 years, with almost zero advertising. Almost all referrals.

    Hope that helps. Good Fortune.

    4Reply
  • Philip Cutting
    OP
    Virtual Assistant · Reynoldsburg, OH · Member since 2014 · 66 posts · 23 votes
    12y

    Hi @Darrin Carey ,

    Thanks for answering all those questions.  That link you gave me was great! It answered so many questions and with that information I have ideas on how to handle most all my situations!  

    Thanks

    Phil

    0Reply
  • Alex Holt
    Wholesaler and Investor · Cincinnati, OH · Member since 2015 · 69 posts · 15 votes
    10y
    Originally posted by @Steve Baldwin:

    Good morning Phil, 

    It was my understanding that you need to be a licensed agent just to be a property manager for your own or for someone else's properties in Ohio. I do not see any issue with running a property management company as a agent only and do not see why you would have to hold a broker's license. @peterlohman?

    Currently, we are using trello.com (FREE!) which is a online project management company. Very easy to use and sends out tickets to contractors, managers, etc. They also have a very user friendly app for smart phones.

    I strongly believe in owning your own property management company for larger number doors. This frees up your time for financing, finding deals and purchasing.

    When are you coming to Columbus? Id love to chat with you on how we are structuring our company and our game plan! Sounds we have a very similar approach!

    Thanks bud,

    Steve

    Hey I am just now seeing this thread and I am interested in getting into property management and would love to learn more from you I'm in the Cincinnati area looking to get started on things . 

    1Reply
  • Justin Lemaster
    Real Estate Agent · Columbus, OH · Member since 2015 · 57 posts · 31 votes
    10y

    I believe you need a licensed real estate broker. You can always call the Ohio Division of Real Estate for clarification.

    1Reply
  • Steve Baldwin
    Rental Property Investor · Columbus, OH · Member since 2012 · 181 posts · 51 votes
    10y

    @Alex Holt I would be happy to offer any info that could help! 

    0Reply
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