Understanding the Difference Between a Managed and Procurement lease
Category Principal's Message
When renting out a property, the landlord should have signed a mandate with his agent if he has employed one, which sets out the terms of the service contract between them but there are many cases where some "forget" or confuse what type of mandate they have.
The contract is usually for a fixed term, and there would typically be three types of mandates: a managed lease for an unfurnished house with full administration of the property, a managed lease for a furnished house, also with full administration and a non-managed lease, which has no administration service offered.
-A tenant procurement option where the agent finds a suitable tenant for the landlord and does the background checks and drafts a lease agreement. The management of the property would remain the responsibility of the landlord but a fee is paid to the agent for finding a tenant;
- A continuance (managed) option so that the agent finds the tenant and manages the lease agreement, monitors payments and is involved in maintaining the property.
If the agent is managing the property on behalf of the landlord a fee is charged based on the monthly rental.
Author: Prime Property Marketing