Property managers often work under the direction of, or in coordination with a residents’ management company (RMC). While the responsibilities of these two roles are different in nature, there are also similarities; tasks that are unclear as to whether they pertain to the property manager (PM) or the RMC; and overlapping tasks.
What exactly are the differences between PM and RMC? Read on, as we size ’em up.
What is an RMC?
Protecting the interest on behalf of the leaseholders, an RMC is usually in charge of maintaining the common parts of a building (i.e. hallways, entryways, gardens, driveways). They can have other responsibilities as well. Typically a tenant is appointed by the other residents to manage the RMC, and they are unpaid for this position.
An RMC that has been formalized differs from a residents association that is informal, in the respect that an established RMC holds legal status which provides greater protection for all involved.
A Memorandum and Articles of Association will be drawn up by the RMC that allows the company to manage and administer a leasehold or freehold property – that is typically divided into multiple dwellings, apartments, or flats. Each leaseholder in the building owns a share of the company. Upon leaving the property, the leaseholder transfers ownership of the share to the next leaseholder.
Conflict of Interest
The confusion arises from the fine lines between tenants’, property managers’, or RMCs’ responsibility. Tasks often crossover. For this reason, property managers need to work closely with the RMC to stay organized and maintain a clear understanding of who does what.
To better understand the roles in this property manager / RMC arrangement, let’s review the distinct differences in these two entities:
Characteristics of an RMC:
– An RMC is a non-profit company usually consisting of unpaid tenants taking responsibility for the building.
– A formalized RMC differs greatly from an informal residents association.
– An RMC can employ a managing agent that is experienced in handling the technical and legal implications for leaseholders.
Characteristics of a Property Manager:
– A property manager is a paid representative.
– Property managers are in charge of collecting rent and sometimes setting rent as well.
– Property management is in charge of marketing the property and finding/screening new residents.
– They handle evictions.
– Conduct move-in / move-out inspections
When it comes down to it, the property manager is more accountable and is responsible for the critical affairs associated with the real estate in question.
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