Start a Property Management Company in Ohio | 2024 Guide

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Ohio Property Management Company

Are you considering starting a property management company in Ohio? Property management is an excellent business opportunity for individuals with a passion for real estate who are detail-oriented and can effectively manage multiple tasks simultaneously. The demand for property managers continues to grow, making it an attractive and lucrative Limited Liability Company in Ohio.

Webinarcare Editorial Team will help you gain knowledge through thorough research and market study. Before Starting a Property Management Company in Ohio, all the steps in this article must guide you.

How to Start a Property Management Company in Ohio

What is a Property Management Company?

A property management company in Ohio is a professional firm that handles the administration of residential, commercial, or industrial real estate. Such companies deal with all aspects of managing a property, from finding and vetting tenants to repairing and maintaining the property, collecting rent, and handling tenant issues. These companies are an asset for property owners who may not have the time or expertise to manage their properties effectively and efficiently.

Forming a Limited Liability Company (LLC) can be a strategic decision for those considering starting a property management company in Ohio. Starting an LLC provides several benefits, including the protection of personal assets. In an LLC, the owner’s assets are protected in case of any litigation or debt incurred by the company. It also offers greater credibility and potential tax advantages and allows for an easy ownership transfer. Starting an LLC involves filing the necessary paperwork with the Ohio Secretary of State and paying an initial filing fee.

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How to Start a Property Management Company in Ohio

Starting a property management company in Ohio can be a lucrative and rewarding business venture especially if you are in Columbus. With the right planning, resources, and dedication, you can create a successful company that caters to the needs of property owners and investors in your area. Here is the step-by-step guide to launching a property management company in Ohio.

Step 1: Understand Property Management

Property management oversees and operates real estate properties, including residential, commercial, and industrial properties. The role of a property manager is to manage the day-to-day activities of properties, ensuring that they are well-maintained and that rent is collected on time. Property managers also deal with tenant issues, repairs and maintenance, and marketing vacant properties.

Step 2: Evaluate The Market

Before starting a property management company in Ohio, you need to evaluate the local market to determine if there is a demand for your services. Here are some factors to consider:

  • Type of Properties: Determine the properties in Ohio, such as single-family homes, multi-family buildings, commercial properties, or vacation rentals.
  • Competition: Identify other property management companies and analyze their services, pricing structures, and market share.
  • Market Trends: Research the local real estate market trends, including rental rates, vacancy rates, and property values.
  • Potential Clientele: Determine the number of property owners and investors in your target area who may require property management services.

Step 3: Create a Business Plan

A solid business plan is crucial for the success of your property management company. Your business plan should include the following elements:

  • Executive Summary: A brief overview of your Ohio property management company, including its mission statement, goals, and objectives.
  • Market Analysis: A detailed analysis of the local real estate market, competition, and potential clients.
  • Services: Describe the property management services you plan to offer, such as tenant screening, rent collection, property maintenance, and marketing.
  • Marketing Strategy: Outline your marketing plan, including your target audience, marketing channels, and budget.
  • Financial Projections: Provide financial projections for your property management company, including revenue, expenses, and projected profits.

Step 4: Register Your Business and Obtain Licenses

To start a property management company in Ohio, you must register your business and obtain the necessary licenses and permits. Here are the steps to follow:

Choose a Business Structure

For starting a property management company, several business structures are available in Ohio. Each structure has its benefits and drawbacks, depending on your business goals, financial situation, and personal preferences. The common business structures you can choose from are:

  • Sole Proprietorship: This is the simplest business structure, which involves a single individual owning and operating the property management company. The owner has complete control over the business and is personally responsible for all debts and liabilities. There is no formal registration process for a sole proprietorship, but you may still need to obtain licenses and permits specific to property management.
  • Partnership: A partnership is a business structure where two or more people share ownership of the property management company. Partnerships can be general, limited, or Ohio Limited Liability Partnerships (LLP). Each partner contributes to the business and shares in profits and losses. Partnerships must file a partnership agreement with the Ohio Secretary of State and obtain necessary licenses and permits.
  • Limited Liability Company (LLC): An LLC is a hybrid entity that combines a partnership’s flexibility with a corporation’s limited liability protection. Owners, known as members, are not personally responsible for the company’s debts and liabilities. To form an LLC in Ohio, you must file the Articles of Organization with the Ohio Secretary of State and comply with any licensing and permitting requirements.
  • Corporation: A corporation is a separate legal entity from its owners, known as shareholders. Corporations offer limited liability protection and can issue stock to raise capital. There are two types of corporations: C Corporations and S Corporations. Forming a corporation in Ohio requires filing the Articles of Incorporation with the Ohio Secretary of State.
  • Professional Corporation (PC): This type of corporation is designed specifically for licensed professionals, such as real estate brokers, who wish to form a corporation for their property management company. Professional Corporation offers limited liability protection and must comply with all state regulations for the specific profession. To form a Professional Corporation in Ohio, you must file the Articles of Incorporation with the Ohio Secretary of State and adhere to any licensing and permitting requirements.

Before choosing a business structure for your property management company in Ohio, consult with a Business Attorney in Ohio to discuss the best option for your situation. Remember that each structure has its tax implications and requirements, so it is essential to understand your choice’s financial and legal ramifications.

Choose a Business Name

Choosing a business name for your Ohio property management company is important to establish your brand identity and attract potential clients. Here are a few suggestions to consider:

  1. Ohio Premier Property Management
  2. Ohio HomeGuard Property Services
  3. Ohio Nexus Property Management
  4. Ohio BlueSky Property Solutions
  5. Ohio KeyPoint Property Management

Remember to check the availability of your chosen business name with the Ohio Secretary of State Business Search and ensure it’s not already in use by another company. There is a complete guide on Ohio Business Name Search for you to have a property management company name. You can register your business under a different legal name if your preferred name isn’t available. Once you have chosen a name, you can submit an application for Ohio DBA (doing business as). 

However, before filing a DBA, you should know that you need to renew your DBA every five years, which costs varies by county.

Once you’ve settled on a unique name, you can hire a Statutory Agent and obtain the required licenses and permits.

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Hire a Statutory Agent

A Statutory Agent is a person or entity designated to receive important legal documents and correspondence for your business. In Ohio, every business entity, such as an LLC or a corporation, must have a Statutory Agent with a physical address within Ohio. The Statutory Agent’s primary role is to ensure that your business complies with state regulations and be available to receive any legal notices or official government correspondence.

In Ohio, the cost of having a Statutory Agent ranges from $50 – $150. However, suppose you are still wondering how to hire a Statutory Agent. In that case, you can also serve as your Statutory Agent, appoint a friend or family member, or hire the Best Ohio Statutory Agent Services.

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File For Articles of Organization or Articles of Incorporation

If you form an LLC for your Ohio property management company, you must file the Ohio Articles of Organization, which costs $99. However, you must file the Articles of Incorporation if you form a Corporation for your Ohio property management company. The Articles of Incorporation filing fee costs $99 for online and by mail filing. It is crucial to provide accurate and complete information on this document, as errors or omissions may result in delays or rejection of your filing.

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Obtain an Employer Identification Number

You must first obtain an Employer identification number (EIN) in Ohio from the IRS if you will open a bank account or hire an employee for your Ohio property management company. 

The application of an EIN in Ohio can be through the following:

  • Apply Online- The online EIN application is the preferred method for customers to apply for and obtain an EIN.
  • Apply by Fax- Taxpayers can fax the completed Form SS-4 application to the appropriate fax number), after ensuring that the Form SS-4 contains all of the required information.
  • Apply by Mail- The EIN application Form SS-4 can be filed via mail. The processing time frame to receive the mail is four weeks.
  • Apply by Telephone-International Applicants – International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.

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Get the Necessary License and Permits

When starting a property management company in Ohio, you must obtain legal licenses and permits. Here are some common licenses and permits you may need:

  • Business License: Ohio requires businesses to obtain a Business License to operate legally. The business license fee in Ohio ranges from $50 – $300.
  • Real Estate Broker License: In many states, property management companies must have a licensed real estate broker or designate a licensed broker to oversee the business operations. Check with your Ohio Real Estate Commission or similar governing body for the requirements and application process.
  • Salesperson License (if applicable): If your Ohio property management company also engages in leasing or renting properties, you may need to have a licensed salesperson working under the supervision of a licensed broker.
  • State Tax Registration: Register with the Ohio Department of Taxation to collect and remit sales and use taxes and other applicable state taxes.
  • Local Zoning and Land Use Permits: Depending on the nature of your Ohio property management services and the location of your office, you may need to obtain zoning and land use permits. 
  • Workers’ Compensation Insurance: If you have employees, you’ll likely need to obtain workers’ compensation insurance by Ohio’s laws.
  • Professional Liability Insurance: Ohio property management companies should consider obtaining professional liability insurance (errors and omissions insurance) to protect against potential legal claims related to business operations.

Before starting your property management company, consult a Business Attorney in Ohio to ensure you obtain all the necessary legal permits and licenses. Failing to do so can result in fines, penalties, and even the closure of your Ohio business.

Step 5: Set Up Your Office

While starting a property management company without a physical office is possible, having a dedicated workspace can help establish your credibility and professionalism. Select a location that is convenient for both you and your clients. This may be a home office, a co-working space, or a commercial office space. Also, you will need basic office equipment such as a computer, printer, phone, and filing system.

Step 6: Market Your Property Management Company

Effective marketing is crucial for attracting clients and growing your Ohio property management business. Usually, the best way to market your property management company is to advertise in local newspapers, real estate magazines, and direct mail campaigns.

Step 7: Build a Team

As your property management company grows in Ohio, you may need additional staff to help manage your workload. Consider hiring property managers, administrative assistants, maintenance technicians, and marketing professionals. Ensure your team is knowledgeable, professional, and committed to providing excellent customer service. However, before hiring an employee for your Ohio property management company, you should obtain an EIN and open a bank account.

Benefits of Starting a Property Management Company

There are several benefits of starting a property management company in Ohio:

  • Steady Income: Property management is a growing industry in Ohio, and there is always a demand for qualified professionals to manage properties. This means starting an LLC property management company can provide a steady income stream.
  • Low Startup Costs: Starting a property management company requires minimal investment, as you do not need to purchase any property. You can start with just a few clients and gradually increase your portfolio.
  • Flexible Work Schedule: Property management companies offer flexible work schedules, allowing you to work around other commitments such as family and other business ventures.
  • Growth Opportunities: With the right marketing strategies, you can rapidly grow your property management company and increase your client base.
  • Diverse Client Base: Property management companies cater to a diverse range of clients, including landlords, tenants, and property owners. This means that there is always a demand for your services.

FAQs

What are the requirements for starting a property management company in Ohio?
To start a property management company in Ohio, you will need to register your business with the Ohio Secretary of State’s office and obtain any necessary licenses or permits.
What kind of insurance do I need for my Ohio property management company?
You will need liability insurance to protect your company from any legal actions taken against it.
What is the average salary for a property manager in Ohio?
The average salary for a Property Manager in Ohio ranges from $45,000 to $60,000 per year.
How do I find tenants for my Ohio rental properties?
You can advertise vacancies on websites like Craigslist and post to Ohio rental property listings.
What are the property management laws in Ohio?
Property management laws vary in Ohio depending on the city and county.
What is the property management business like in Ohio now?
Ohio is a promising place to start a property management business. Demand for rental properties continues to rise.
Do I need a real estate license to start a property management company in Ohio?
You need to obtain a license if you broker properties (such as handle leases) and if you earn a commission.
Can an undocumented immigrant start a property management company in Ohio?
No.
Can out-of-state residents start a property management company in Ohio?
Any US citizen who satisfies other Ohio requirements can start a property management company.
Do I need any particular qualifications to start a property management company in Ohio?
You do not need any particular qualifications, but a Bachelor’s degree or a certificate in in property administration will help considerably.
What legal documents are needed to start a property management company in Ohio?
Articles of Incorporation, a Lease agreement template, and a Self Storage Lease agreement are some legal documents you need.
What are the most important things I need to know before starting a property management company in Ohio?
Some of the key things you need to understand include Ohio laws related to rental properties, managing cash flow, market conditions, and management principles.
What hard and soft skills should I gain to become a successful property manager in Ohio?
Some of the important skills that make a quality property manager are good communication skills, project management, and bookkeeping proficiency.
How can I market my Ohio property management company?
You can start by building a website, cold calling potential clients or posting ads on online property portals advertising your firm.
Should I hire a property manager to oversee one or more Ohio properties?
It makes more sense to have a property manager if you’re managing more than two or three property units.
Is Ohio a good place to start a property management company?
Ohio is a promising state to start a property management business venture.
What type of businesses are considered competition to an Ohio Property Management business?
Local real Estate agencies and independent property businesses can be major competitors to new Ohio Property managers.
What are the essential software or tools that a new Ohio property manager should have?
Comprehensive accounting software and an efficient property management software are critical tools for Ohio property managers.
How much money does it cost to launch an Ohio property management business?
startup costs in Ohio property management range between $2000- $10,000.
Can I provide self-property management in Ohio?
Yes, if you can monitor your responsibilities efficiently.
Should I offer client discounts if I’m starting an Ohio property management company?
Initially, It is best not to give any client discounts.
What should be present inside the lease contract for the Ohio Rental Property Management Business?
The name of the Property Owners or Lessees, insurance documents, tenant duties, Security Deposits, and Rent Collection processes are standard things.
What are typical hurdles that Ohio property managers see?
possible market disruptions and adapting to changing property laws are standard hurdles among Ohio Property managers.
Are there variations in building codes as determined by the Ohio city?
Yes, laws regarding cities and Best practices related to maintaining rental properties can change, so it’s essential to keep yourself informed.
What tax-related legal documents are required for Ohio property management companies?
IRS form 8825, or profit or loss forms, must be accounted for Ohio.Property management companies in Ohio are entities separate from its owners.
How long does it usually take to set up an Ohio property management company?
It takes about four weeks from the date of incorporation.
What is the percentage of income from rent collected goes towards typical management fees in Ohio?
Typically, Ohio property managers receive about 8%-12% monthly management fees.
How often should an inspector check vacant properties in Ohio?
Ohio Property management companies should follow vacancy compliance laws by inspecting vacant properties every thirty-days and ensuring warmth, cleanliness, and other safety metrics.
What kind of services do property management companies in Ohio offer?
Property management companies in Ohio offer a range of services, from tenant screening and leasing to rent collection and maintenance and repairs. Some companies may also offer property marketing and accounting services to property owners.
What is the best way to get a real estate broker’s license in Ohio?
The best way to get a real estate broker’s license in Ohio is to take and pass the Ohio Real Estate Salesperson Exam, complete the required coursework, fulfil the experience requirements, and submit an application and fees to the Ohio Division of Real Estate and Professional Licensing.
Must property management companies in Ohio be licensed or registered?
Yes, property management companies in Ohio must either be licensed brokerages or at least employ a licensed real estate broker to provide property management services.
What is the cost of starting a property management company in Ohio?
The cost of starting a property management company in Ohio can vary widely based on several factors, including the cost of acquiring a real estate broker’s license, the cost of marketing your services to potential clients, and the cost of liability insurance.
What is the responsibility of a property management company in Ohio?
The responsibility of a property management company in Ohio is to manage rental properties for their clients, which includes tasks such as tenant selection, maintenance and repair, rent collection, financial management, and property marketing.
Do I need a business license to start a property management company in Ohio?
Yes, most property management companies in Ohio will be required to obtain a business license, which may require registering and paying fees with the Ohio Secretary of State’s Office.
What kind of insurance is required for a property management company in Ohio?
Property management companies in Ohio are required to obtain liability insurance, which may include a general liability policy and errors and omissions coverage.
How do I find clients for my property management company in Ohio?
Property management companies in Ohio can find clients through several channels, such as referrals, advertising, and online marketing. attending industry events, and networking with other real estate professionals.
How does a property management company in Ohio screen tenants?
Property management companies in Ohio generally screen tenants by performing background checks, credit checks, income verification, and reference checks.
How does a property management company in Ohio evict a tenant?
Property management companies in Ohio must follow the state’s eviction process, which involves providing a proper notice to the tenant, filing an eviction lawsuit in court, and attending a hearing to determine if eviction is necessary.
Is there a need for property management companies in Ohio?
Property management companies in Ohio can be highly valuable, especially for property owners who do not have the time or resources to maintain their properties. Property managers also have a wealth of knowledge and expertise that can help to boost a property’s value and attract tenants.
How do Ohio’s landlord-tenant laws impact property management companies?
Ohio’s landlord-tenant laws contain rules regarding lease agreements, eviction proceedings, discrimination, and other related issues. Property management companies must follow these laws to avoid legal disputes or liability issues.
What is the process for renewing a property management company license in Ohio?
Property management companies in Ohio must renew their licenses at least every three years through the Ohio Division of Real Estate and Professional Licensing and comply with any continuing education requirements.
Can property management companies in Ohio be held liable for tenant injuries or accidents on their properties?
Property management companies in Ohio can be held liable for tenant injuries or accidents if they are proven to have been negligent or failed to take reasonable steps to prevent the injury or accident from occurring.
How does a property management company in Ohio collect rent from tenants?
Property management companies in Ohio typically collect rent from tenants through an online portal or through a mailed check.
What happens if a tenant damages the property in Ohio?
Tenants in Ohio can be held responsible for any damage they cause to a rental property through security deposit deductions or a lawsuit.
Who is responsible for paying for maintenance and repairs in Ohio rental properties?
The responsibility for paying for maintenance and repairs varies depending on the lease agreement and state laws. In most cases, the landlord is responsible for major repairs and safety-related items, while tenants are responsible for minor repairs and daily upkeep tasks.
What are some common mistakes new property management companies make in Ohio?
Some common mistakes new property management companies make in Ohio include failing to screen tenants properly, not having the proper insurance coverage, and failing to comply with Ohio landlord-tenant laws.
How does Ohio law regulate security deposits for rental properties?
Ohio law requires landlords and property managers to either place a tenant’s deposit in an escrow account, post an insurance bond, or purchase insurance to cover the amount. The deposit must be returned to a tenant within 30 days of the lease’s termination.
How does Ohio law regulate discrimination against tenants?
Ohio law prohibits discrimination against tenants based on factors such as religion, race, national origin and familial status.
Can a property management company in Ohio terminate a lease agreement with the tenant?
Property management companies in Ohio can terminate a lease agreement with the tenant if the tenant fails to meet the lease obligations, does not pay rent, violates the lease agreement or the tenant is conducting illegal activities in the premises.
Does Ohio law require property management companies to take care of maintenance tasks and repairs?
Yes, Ohio landlords who are responsible for repairs and maintenance on their rental properties are required by law and administrative code provisions to make necessary well being and upkeep renovations to the In-control grounds and extrerior of rental properties.
Can a property management company require tenants to carry renter’s insurance in Ohio?
Ohio state laws don’t requires rental real estate brokers or lessors to need tenants to obtain renter’s insurance, however property managers are well within their right to require tenants and co-tenants to carry renters insurance.
Can property management companies in Ohio make their own repairs?
Yes, if conveyed correctly in the lease agreement, property managers in Ohio can make their own repairs or use a service technician for basic upkeeps to ensure the prompt attention for these maintenance items.
How does property management companies handle problems with sewer, water, or natural gas lines that serve rental property in Ohio?
Ohio law requires a landlord to repair a deteriorated or blocked waterline likeliness because of root disturbance somewhere near the supply or drainage piping serving the customer’s property. Sewage Wipeouts, uncorroded substances, choking, and blockage of drainage pipes beyond tenants handle must be cheerfully fixed in due time. Lastly Ohio propery managemen company can advantageously work with Ohio gas distributors to facilitate safe and secure gas operations for their rental property owners.
Does a property management company in Ohio need to give notice before entering rental units?
Ohio law requires a property management company have written notice for at least 24 hours frequently for the purpose of garbing prepared and recuperating from the previous person which ranges from providing amenities to respond to operational apparatus taken with advertisement. Unless emergency appear due to serious concerns, death or legal procedures communicated properly to inhabiting tenants as reasonably quick as be accomplished.
What is the maximum security deposit a property management company can charge in Ohio?
There is no limit to the amount of security deposit that a property management company may seek for a unit assign rental property, however most landlords seek a payment equivalent to one to two months rent cost without prorated.
What are tenant screening regulations set up by Ohio governments?
In Ohio multiple screenings and checks can be conducted throughout the tenant admission and placement process like conducting thorough criminal background history, verified identity claiming ownership complete details, employment validation.
Are Ohio eviction notice forms accessible online?
Ohio eviction notice forms outlining termination of agreement communicate are not hard to find

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Conclusion

Starting a property management company in Ohio can be rewarding and profitable. By following the steps outlined in this guide, you can launch a successful property management business that meets the needs of property owners and investors in your area. Remember to stay up-to-date on industry trends and continually refine your services, marketing strategies, and customer service to ensure the long-term success of your property management company.

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