The role of a real estate agent and a property manager may seem similar, but they are pretty different.
Real estate agents are typically focused on finding buyers and sellers for properties. In contrast, property managers are responsible for the day-to-day management of properties, including maintaining the property, collecting rent, and handling tenant issues. However, it is possible for a real estate agent to also serve as a property manager. Is it legal? Or even Ethical?
Becoming a property is a great way to diversify your income and offer your clients a more comprehensive range of services. If you’re considering becoming a property manager, you must know the challenges of this combination of roles. It can be a lot of work to juggle both roles, and you’ll need to be able to handle the challenges that come with managing multiple properties and clients. But the rewards can be significant if you’re up for the challenge and have the skills and drive to succeed.
With the right approach and mindset, you can successfully provide valuable services to your clients and earn a good income.
1. Becoming a Property Manager
1.1 Educational Qualification
People see property management as a trade with more casual or vocational origins than real estate- a sector that is considered more organized. Even though the subject matter is more or less relevant in both cases, the study for real estate agents is more in-depth and targeted due to the broader and more detailed work requirement.
This is why property managers do not specifically need a bachelor’s or master’s degree, albeit such a degree can help.
1.1.1 Educational Requirements for Property Managers
Here are the educational qualifications required for being a property manager:
- An Associate’s Degree in Property Management or a related field. So if you are a realtor, you are already at the perfect starting point for your career in property management. An associate degree provides a solid foundation of knowledge and skills essential for entry-level roles in the field. Such degrees typically take two years, including coursework in property management, real estate, marketing, and financial management.
- Bachelor’s Degree: A bachelor’s degree in property management or a related field such as real estate or business, A Bachelor of Science (BS) or Bachelor of Arts (BA) in Real Estate, which is a four-year undergraduate degree program can take you to the next level in the field of property management. These programs typically take four years to complete and provide a comprehensive understanding of the industry.
- On-the-job Training: On-the-job training is an excellent way for aspiring property managers to gain hands-on experience and learn the ins and outs of the field. Many property management companies offer training programs for entry-level employees, allowing them to learn the ropes while working.
Property managers are responsible for managing rental properties, such as apartments and commercial buildings, on behalf of their clients.
This typically includes renting out units, collecting rent, and dealing with tenant disputes. The educational requirements for property managers depend on the state, but in most cases, property managers need to have a high school diploma or equivalent.
Additional certifications, such as a Certified Apartment Manager (CAM) certification, may also benefit those interested in pursuing a career in property management.
When it comes to property management and real estate, it is essential to have a proper license to operate legally and ethically. Each state has its criteria and requirements for obtaining a license in the United States.
As per the National Association of Residential Property Managers (NARPM) Property Manager Requirements by State, Property managers must typically hold a real estate broker’s license to manage properties on behalf of owners. This license is granted by the state’s real estate commission and requires the completion of specific educational and examination requirements and a background check.
According to the National Association of Residential Property Managers (NARPM), the license is “intended to protect both the property owner and the tenants by ensuring that the person managing the property is qualified and knowledgeable about the applicable laws and regulations.”
1.2.1 A complete step-by-step guide for getting a property management or real estate license
The procedure for obtaining property management also varies by state but generally includes the following steps:
- Meet the eligibility requirements for the license. This typically includes being at least 18 years old and having a high school diploma or equivalent.
- Complete the required education and training. This can include online courses, in-person classes, or a combination.
- Pass the real estate licensing exam. This exam will cover state and federal laws, real estate principles, and practices.
- Apply to the state real estate licensing agency. This will include submitting proof of education and training, passing the licensing exam, and passing a background check.
- Obtain errors and omissions insurance. This liability insurance protects real estate agents and brokers from professional negligence claims.
- Renew your license periodically. Most states require real estate licenses to be renewed every two years; continuing education may be required to maintain the license.
One of the most important aspects of being a successful property manager or real estate agent is having a solid understanding of the real estate industry. Industry standards, especially in real estate, are always changing, and individuals in property management need to stay current with the latest laws, regulations, and best practices.
Skills essential for property managers:
- Strong communication skills
- Knowledge of real estate laws and regulations
- Experience with property management software
- Strong organizational skills
- Financial management and budgeting skills
- Strong negotiation skills
- Problem-solving and conflict-resolution skills
- Marketing and advertising skills
- Strong customer service skills
- Familiarity with local market conditions and trends.
Negotiation and marketing skills are critical for real estate agents to match clients with properties and negotiate on their behalf effectively. Plus, realtors are often on top of market trends and micro-market conditions. So, if you are already a successful real estate agent, the odds of you being a great property manager are high.
A property manager is responsible for the day-to-day management of properties. This includes tasks such as:
- Maintaining the property and ensuring that it’s in good condition
- Collecting rent and handling late payments
- Screening tenants and handling tenant complaints
- Coordinating repairs and maintenance
- Handling evictions and legal issues
- Ensuring compliance with local, state, and federal laws and regulations
- Thoroughly examining the properties
- Marketing the property in an effective manner
- Administrate the fellow employees
In addition to these tasks, property managers also have to handle the stress of managing multiple properties and tenants. Property managers are equipped to manage commercial and residential properties, and a diverse range of clients, including individuals, businesses, and not-for-profit organizations, utilize their services.
They must have excellent organizational and problem-solving skills and a solid understanding of property management regulations. They must also have good communication skills to communicate effectively with tenants and landlords.
2.Do Property Managers Make More Than Real Estate Agents?
Regarding salary, whether property managers make more than real estate agents is a bit more complicated than a simple yes or no.
The direct and precise answer to this question is that real estate agents may earn more than property managers. There is a wide variety of reasons for it as well. However, the data can vary as per the location.
According to data from Indeed, the average salary for a property manager is $55,346, while the average salary for a real estate agent is $94,134. However, according to the National Association of Realtors, the median gross income of real estate agents in 2021 was $64,400. Whereas the average salary of a real estate agent, as per the U.S. Bureau of labor statistics, comes out to be $48,770 per year, and that of a property manager is estimated to be $59,230 per year.
Data from Glassdoor also suggests that property managers make around $64,037 annually, and real estate agents make roughly around $67,483 per year.
From salary.com, it can be noted that the average pay of property managers is estimated to be around $106,491, and that of the real estate agent is estimated to be $44,712.
2.1 Salary Comparison between Property managers and Real estate Agents (by States)
The cost of living, housing market conditions, and the level of competition in the area can all play a role in determining the salary for these roles. Here is a comprehensive view of the salary comparison between a property manager and a real estate agent as per state:
|S. No.||State’s Name||Property manager’s salary ($/Yearly)||Real estate agent’s salary ($/Yearly)|
While it is clear from the above assessment that your earning potential is higher than property managers, it is also true your salary is largely dependent on whether you get business or not. As property managers, you will have a consistent income stream from the rent you collect, and while it is a lot of effort, you can typically earn more by working these two jobs.
3. Do Property Managers Need a Real Estate License?
According to the National Association of Residential Property Managers (NARPM), only six states do not require a real estate license for property managers. These are Idaho, Kansas (only for residential), Maine, Maryland, Massachusetts, and Vermont. Property managers in these states are not required to hold a license, but they may still need to meet other requirements to manage properties legally.
However, it’s important to note that even in states without a real estate license, property managers may still need to meet other qualifications to manage properties legally. For example, they may need to pass a background check or complete a certain amount of education or training. Additionally, property managers may need to be affiliated with a licensed real estate broker to manage properties legally.
In most cases, a real estate license is required for property managers to manage properties on a landlord’s behalf legally. In addition, if a property manager handles rental transactions such as rental agreements, collecting rent, and handling security deposits, they may be required to have a real estate license. Property managers must pass an exam and complete continuing education courses to maintain their license in states requiring a real estate license. They should also be aware of the state-specific laws and regulations that apply to property management.
3.1 Real Estate License for Property Management (By State)
The licensing requirements for property managers vary by state. In some states, a real estate license is required to manage properties; in others, a separate property management license is required. In some states, no license is required at all. Different states have different laws regarding licensure. You can go through the statewide information to find relevant information.
A property management license is required to manage properties in the District of Columbia, Montana, Oregon, South Carolina, and South Dakota. In Oregon, a real estate broker license is also accepted.
In states where a real estate license is required to manage properties, it generally allows the holder to perform property management activities such as leasing, collecting rent, and handling tenant issues. Examples of states where a real estate license is required to manage properties include:
- New Jersey
- New York
- North Carolina
- Rhode Island
A property management license is typically separate from a real estate license in states where it is required. This means a person must have a property management license and a real estate license to manage properties.
In states where no license is required for property management, anyone can manage properties without obtaining a specific property management license. However, it’s important to note that there may be other regulations that must be followed, such as fair housing and landlord-tenant laws. Examples of states where no license is required for property management include:
- New Hampshire
- New Mexico
- North Dakota
In some states, a separate license is required for residential and commercial property management. For example, in California, a real estate broker license is required to manage commercial properties, while a residential property management permit is required to manage residential properties. In Florida, a separate license is required for community association management. It’s important to research the specific licensing requirements for the state in which you plan to manage properties.
1. What Are the Benefits of Being a Property Manager?
One of the main benefits of being a property manager is the potential for steady income. Property managers typically earn a percentage of the rent they collect, which can provide a consistent income stream. Property managers can also earn bonuses or incentives for keeping occupancy rates high and managing properties effectively.
Another benefit of being a property manager is building long-term relationships with tenants. Property managers are often the first point of contact for tenants when they move into a property and often serve as the main point of contact throughout the tenancy. This can lead to strong working relationships and a sense of loyalty from tenants.
Whereas the major benefit of being a real estate agent is earning potential. Real estate agents are typically paid on commission, which means they earn a percentage of the sale price when a property is sold. This can lead to a high earning potential for successful agents.
Another benefit of being a real estate agent is being your boss. Real estate agents often work independently, setting schedules and determining business strategies. This can provide a sense of freedom and flexibility many people find appealing.
It’s also worth noting that the benefits of being a property manager and a real estate agent may vary depending on various factors, such as:
- Location: The benefits of being a property manager or a real estate agent can vary by state due to differences in the local real estate market, property management regulations, and rental laws. For example, some states may have higher rental demand or more favorable landlord-tenant laws, which can impact the earning potential and job opportunities for property managers and real estate agents.
- Experience: More experienced property managers and real estate agents may command higher salaries and fees, easily attract clients, and secure new businesses.
- Expertise: The level of expertise a property manager or real estate agent has in specific areas, such as property management, investment properties, or luxury homes, can also impact their earning potential and career opportunities.
- Education and certification: Obtaining professional designations, such as the National Association of Residential Property Managers (NARPM) or the National Association of Realtors (NAR), can demonstrate a commitment to the industry and enhance a property manager’s or real estate agent’s skills and credibility.
The benefits are not limited to the advantages or competitive edges but extend to the work and earnings potential.
2. What Are the Differences Between a Property Manager and a Real Estate Agent?
|Property Manager||Real Estate Agent|
|A property manager is responsible for the day-to-day management of properties, including maintaining the property, collecting rent, and handling tenant issues.||Real estate agents are focused on finding buyers and sellers for properties and are typically paid on commission, meaning they earn a percentage of the sale price when a property is sold.|
|Property managers are responsible for ensuring the property is in good condition, coordinating repairs and maintenance, and ensuring compliance with local, state, and federal laws and regulations.||Real estate agents are responsible for marketing properties, showing them to potential buyers, negotiating deals, and closing sales.|
|They are responsible for screening tenants, handling tenant complaints, evictions, and legal issues, and keeping accurate records and financial statements.||They are responsible for staying informed about local zoning laws and regulations and advising clients on real estate matters, such as pricing, mortgages, and legal requirements.|
|Property managers often serve as tenants’ points of contact throughout the tenancy.||Real estate agents often work independently, setting schedules and determining business strategies.|
|Property managers must have excellent organizational and problem-solving skills and a solid understanding of property management regulations.||Real estate agents must have strong sales and negotiation skills and a good understanding of the local market.|
In a nutshell, property managers work to ensure that all the requirements of the property and its tenants are met. Real estate agents are focused on finding buyers and sellers for properties and have to handle the stress that comes with the sales process and have the ability to handle multiple clients at the same time. Both roles require different skills and knowledge and have different responsibilities, but both are crucial in the real estate industry.
Yes, a real estate agent can also be a property manager, but it’s important to note that the two roles are not the same and require distinct skills, knowledge, and responsibilities.
The earning potential for a property manager may not be as high as for real estate agents in a few cases. Still, a steady income can provide financial stability and security. Real estate agents are paid on commission, meaning their earning potential can be quite high, but it also comes with a higher stress level and uncertainty. It’s important to