Most landlords spend weeks deciding which property manager to hire, and about ten minutes reading the agreement they sign with them.
I get it. Management agreements are long, they read like legal paperwork, and by the time you get one you've usually already decided you like the person. But that document is what actually controls your rental. It decides what you pay, who makes decisions, and how hard it is to leave if things don't work out.
Here's what I'd look for before you sign one, whether you're in Dallas–Fort Worth or managing a DFW rental from out of state.
Every Fee, Spelled Out
The monthly management fee is the number everyone asks about. In DFW it typically runs 8–12% of the monthly rent. But it's rarely the only fee, and the others are where surprises come from.
Look for a clear list of anything else you could be charged, such as:
- A leasing or tenant placement fee when a new tenant moves in
- A lease renewal fee
- Any markup on maintenance or repair invoices
- Fees when the home is vacant
- Setup, inspection, or eviction-related fees
None of these are automatically bad. What matters is that you know about them up front. If a fee isn't written in the agreement, ask about it before you sign, not after the first statement.
What's Included (and What Isn't)
"Full-service management" can mean very different things from one company to the next. The agreement should say exactly what the manager will handle: marketing, showings, screening, lease signing, rent collection, maintenance coordination, inspections, and owner statements.
If something you care about isn't listed, assume it's either not included or costs extra. A quick way to check is to compare the agreement against what a property manager actually does and see what's missing.
Maintenance Approval Limits
Most agreements give the manager authority to approve repairs up to a set dollar amount without calling you first. That's a good thing. You don't want to be woken up to approve a $90 toilet repair.
But you should know what that number is, and you should be comfortable with it. Also look at how emergencies are handled. In a Texas summer, an AC that quits can't wait three days for you to return a call, so the agreement should give the manager room to act fast when it's truly urgent.
How Your Money Is Handled
Your rent and your tenant's security deposit pass through the manager's hands, so this section matters. In Texas, a licensed broker who holds money for clients is expected to keep it in a separate trust account, not mixed with the company's own operating funds.
The agreement should also tell you when you'll get paid each month, what reserve (if any) the manager keeps on hand for repairs, and what kind of statements you'll receive. Clear, regular reporting is one of the best signs you're working with someone organized.
Leasing Decisions and Your Say
Who sets the rent? Who approves a new tenant? Can the manager sign a lease on your behalf? Can they renew a tenant without checking with you?
There's no single right answer here. Some owners want to be hands-off, and others want a say in every major decision. The point is to make sure the agreement matches how involved you actually want to be.
The Exit Clause
This is the section I'd read twice. How much notice do you have to give to end the agreement? Is there a cancellation fee? What happens to a tenant the manager placed if you leave? Some agreements charge a fee if you keep that tenant after you cancel.
Also check that the agreement explains what you get back when it ends: keys, the lease, tenant records, and the security deposit, handed over within a reasonable time. A manager who's confident in their service shouldn't need to make it hard for you to leave.
Red Flags to Watch For
- Vague language like "fees as needed" or "reasonable charges"
- Long contracts with steep penalties for cancelling
- Automatic renewals you can't get out of easily
- No mention of how often you'll get statements
- Pressure to sign the same day
If anything in the agreement doesn't make sense, ask. A good property manager will walk you through it line by line without getting defensive.
The Bottom Line
A property management agreement isn't just paperwork. It's the rulebook for your rental. Read the fees, know what's included, understand your repair limit and how your money is handled, and make sure you can leave cleanly if you need to.
At The MTS Group, we're happy to walk owners through our property management agreement before they ever sign it.
This article is general information, not legal or tax advice.
If you're a landlord in the DFW area and want help understanding a property management agreement, I'd love to chat.
Call or text me directly at 682-448-9607, or request a free rental analysis and find out what your property could rent for.