What should a property management agreement include in Virginia?
A strong agreement names the owner, the manager's licence and the property, lists what the manager may do and spend without asking, sets every fee, says how rent and deposits are held in escrow and paid out, assigns repairs and required notices, and spells out how either side can end it. Have a Virginia attorney review it before you sign.
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By Kasra Taheri, Founder, LoclisPublished
Researched and drafted with AI, then checked claim by claim against the sources listed below before it was published. Prices and rules change; the dates beside each source say when it was last checked.
Step by step
Read when to stop and call a pro, further down this page, before you start.
Step 1: Name the parties and the property
State the owner, the licensed firm and its licence, and the address and unit the agreement covers.[7]
Step 2: Define what the manager can do
List the tasks, and say what the manager may sign and spend without calling you.[1]
Step 3: Set every fee
Put each fee, what triggers it and who pays it in the agreement, because a management fee is agreed with a licensee.[2]
Step 4: Describe how money is held and paid
Say which escrow account holds rent and deposits, when you are paid, and what the manager may deduct.[3]
Step 5: Assign repairs and notices
State who orders repairs, the dollar limit, and who handles required tenant certificates, remembering that the legal duty to keep the home fit stays with the owner.[5]
Step 6: Agree on reports and records
Set a monthly statement, access to the lease file and how fast the manager reports complaints and emergencies.
Step 7: Write the end of the agreement
Give the term, how either side ends it, the notice period, and what happens to the tenant's funds and file.[4]
Step 8: Have an attorney review it
Ask a Virginia attorney to read it before you sign, and keep the signed copy with the lease.
A property management agreement is the contract that decides what your manager can do with your house, your tenant and your money. Virginia's landlord-tenant law refers to it directly: a managing agent is the person authorized by the landlord to act as the property manager on behalf of the landlord pursuant to the written property management agreement.[1] What follows is a checklist of the terms worth having in it, based on how Virginia's statutes and Real Estate Board rules treat managers.
Parties, licence and property
Start with who is signing. Name the owner (or the entity that owns the home), the management firm, and the licensed broker responsible for it. Virginia says no individual shall act as a broker without a real estate broker's license from the Board,[7] so put the firm's licence information in the agreement and verify it yourself before you sign. Then describe the property by address and unit, and note any parts excluded from management, such as an outbuilding you rent separately.
The agreement should also say that the manager will disclose your name to tenants. Under the landlord-tenant act, "landlord" also includes a managing agent of the premises who fails to disclose the name of such owner, lessor, or sublessor.[1] A manager who hides the owner can take on the landlord's legal position.
What the manager may do
List the tasks in plain terms: advertising, showings, screening, leasing, rent collection, repairs, inspections and move-outs. Then set limits.
- Signing authority. Can the manager sign or renew leases without asking you, and on what minimum rent and term?
- Spending authority. A dollar amount above which the manager must call you before approving a repair, with an exception for emergencies.
- Vendors. Whether the manager may use its own crews, whether you can use yours, and whether any markup is allowed.
Under the Real Estate Board's regulations, discussing, explaining, interpreting, or negotiating a contract, listing, lease agreement, or property management agreement with anyone outside the firm is reserved for licensees.[2] So expect the person explaining the terms to you to be licensed. Ask them questions before you sign.
Fees
Put every charge in the agreement: the monthly fee, any leasing or renewal fee, inspection and move-out fees, and any markup or coordination charge on repairs. Negotiating or agreeing to any commission, commission split, management fee, or referral fee is another activity the Board reserves for licensees,[2] which is a good reason to settle the numbers in writing with the firm before work begins. Our page on how much a single-family rental costs to manage in Virginia lists the fees to ask about.
Also say who keeps tenant-paid charges. A landlord shall not charge a tenant for late payment of rent unless such charge is provided for in the written rental agreement,[6] and no such late charge shall exceed the lesser of 10 percent of the periodic rent or 10 percent of the remaining balance due and owed by the tenant.[6] The agreement should say whether those charges go to you or to the manager.
Rent, deposits and escrow
This is where owners lose money, so be specific. Under the Board's escrow rule, any application deposit, security deposit, rent, or other money paid to the licensee acting on behalf of a landlord client in connection with the lease must be deposited in an escrow account.[3] Virginia's statute adds that any security deposits paid to a real estate licensee acting on behalf of a landlord client in connection with the lease shall be placed in an escrow account by the end of the fifth business banking day following receipt,[4] and that such funds shall remain in an escrow account until disbursed in accordance with the terms of the lease, the property management agreement, or the applicable statutory provisions.[4]
Write down: the day of the month you are paid, what is deducted first (fees, repair invoices, reserves), how a reserve is set, and the statement you will receive.
Repairs, certificates and notices
The manager arranges the work, but the duty is yours. Virginia's landlord duties include to make all repairs and do whatever is necessary to put and keep the premises in a fit and habitable condition.[5] The agreement should therefore say how tenants report problems, how fast the manager must respond, and which problems count as emergencies.
Include required paperwork. One example: landlords must provide a certificate to the tenant stating that all smoke alarms are present, have been inspected, and are in good working order no more than once every 12 months.[5] Say who inspects, who issues the certificate and who pays.
Ending the agreement
Set a term, a renewal rule, and a notice period for each side. Also say what happens to the tenant's funds. If a licensee acting for a landlord elects to end the agreement, the licensee may transfer any funds held in escrow by the licensee on behalf of the landlord client to the landlord client without his consent, provided that the real estate licensee provides written notice to each tenant that the funds have been so transferred.[4] Your agreement should say how and when that happens.
Foreclosure has its own rule for a single-family home with a written agreement: the foreclosure shall convert the property management agreement into a month-to-month agreement between the successor landlord and the real estate licensee,[4] unless the original terms require an earlier end. The property management agreement may be terminated by either party upon provision of written notice to the other party at least 30 days prior to the intended termination date.[4]
Stop and call a pro if
- The manager cannot show a Virginia licence for the firm and the person who will hold your money.
- The draft says nothing about escrow, fees or termination. Do not sign until it does.
- You are asked to waive a duty the law gives the landlord or tenant. Ask a Virginia attorney before agreeing.
- A dispute is heading to court, whether with a tenant or the manager. Talk to a Virginia attorney.
Getting help in Virginia
Read what a property manager does for a rental owner and whether a property manager needs a licence in Virginia, then browse more commercial answers and the commercial services directory. When a repair needs a tradesperson, describe the job once and local pros quote it.
Common questions
- Does Virginia require a property management agreement to be in writing?
- Virginia's landlord-tenant law defines a managing agent as the person authorized by the landlord to act as the property manager pursuant to the written property management agreement, and the escrow statute refers to the written property management agreement as well. Whatever the minimum, put the terms in writing, even for a short engagement.
- Can I leave the fee off the agreement and settle it later?
- It is a bad idea. The Real Estate Board reserves negotiating or agreeing to any management fee for licensees, which tells you the fee is something to settle up front with the firm. Put every fee, trigger and payer in writing before you sign.
- Who holds my tenant's security deposit?
- If a licensed manager collects it, the manager must place it in an escrow account by the end of the fifth business banking day following receipt, unless the principals agree otherwise in writing. It then stays there until disbursed under the lease, the agreement or the law.
- What happens to the agreement if the house is foreclosed on?
- For a single-family home with a written agreement and a licensed manager, the foreclosure converts it into a month-to-month agreement with the new landlord unless the original terms end it sooner. Either party may end it with at least 30 days of written notice.
- If the manager handles repairs, am I still responsible?
- Yes. The legal duty to keep the premises fit stays with the landlord, so the agreement should say who orders work, the dollar limit, and how emergencies are handled.
Sources
- [1] Code of Virginia § 55.1-1200. Definitions (Virginia Residential Landlord and Tenant Act), Virginia General Assembly, Legislative Information System. Checked October 27, 2026.
- [2] 18VAC135-20-335. Activities to be performed by licensees; activities permitted to be performed by non-licensees, Virginia Real Estate Board, Virginia Administrative Code. Checked October 27, 2026.
- [3] 18VAC135-20-181. Maintenance and management of escrow accounts, Virginia Real Estate Board, Virginia Administrative Code. Checked October 27, 2026.
- [4] Code of Virginia § 54.1-2108.1. Protection of escrow funds held by a real estate broker in the event of foreclosure of real property, Virginia General Assembly, Legislative Information System. Checked October 27, 2026.
- [5] Code of Virginia § 55.1-1220. Landlord to maintain fit premises, Virginia General Assembly, Legislative Information System. Checked October 27, 2026.
- [6] Code of Virginia § 55.1-1204. Terms and conditions of rental agreement, Virginia General Assembly, Legislative Information System. Checked October 27, 2026.
- [7] Code of Virginia § 54.1-2106.1. Licenses required, Virginia General Assembly, Legislative Information System. Checked October 27, 2026.
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