Can property mgmt company manage properties in multiple states?

Question

Hello all,

I’m new to investing in this market (despite living here for 13 years, I invest in multi units out of state) and am focusing on buying and holding multi family units (2-4 doors) in the DFW area.

I am looking at property management companies and am running into the problem of my cash on cash roi falling apart with the tenant turnover charge, as most places charge a full month rent for each tenant turn.

My possible solution is to utilize the out of state property mgmt company to manage properties in Texas. I can’t seem to find out if this is allowed in Texas. Does anyone have any idea or any creative ways, including opening a division of that company in Texas? Thanks!

Justin Olivares · Answer

@Jibran Najmi,

Thank you very much for the detailed reply. I really appreciate you taking the time to provide some insight. Enjoy the weekend!

Greg H. · Answer

In order to manage properties in Texas, one would need to be licensed in Texas

Jibran Najmi · Answer

Justin-

In Texas, a broker is required to oversee all property management activities.  If you're interested in reading about it I would recommend Googling the Texas Real Estate Licensing Act (TRELA).

The act indicates property management as managing, leasing or showing another's property for a fee.  TREC requires a broker to oversee these activities so that in the event that something happens, they have the ability to hold an individual accountable.

Bottom line is that if your out of state property manager/property management company has a employee who is a Broker in Texas, then you would be able to use them for properties in Texas.

The above is just the way I understand the system after having taken the property management classes at TAR, but I would confirm with TREC by emailing them

.  They are pretty prompt in responding, and I've used it to get questions answered without having to sit down with an attorney etc.

I hope this helps, if you have other questions, let me know and I can put you in touch with someone who can help