If you were one of the victims, it is critical that you file a written complaint with RECA (the Real Estate Council of Alberta) at www.reca.ca.

These investors are also at risk of being sued by thier joint venture partners because as the real estate expert, they can ask what due diligence did you do before you hired the ” renovator/property manager”?

5 Critical Questions to Ask Your NEW Property Manager (in Alberta)

1. Are you licensed with RECA? Yes or No.

All Property Managers in Alberta must be licensed with the Real Estate Council of Alberta (RECA). All funds must be handled under “trust conditions”, which means strict handling and report requirements for all trust funds. Investors are protected by an industry Assurance Fund for up to $35,000 per client for cases of Fraud.

If Yes, go to www.reca.ca and check license status. Check out your current property manager.
If No, DO NOT HIRE

Word of Caution, for a Realtor to act as your property manager, he must have the written permission of the Company’s Broker to do so.

2. How Long have you been in Business?

There are many long term property management companies in Edmonton. The shorter time in business, the more check you must do.

3. What is your primary business? Real Estate Sales, Condominium management, or renovations?

You want someone who does property management of the same type of building that you’re trying to buy. If you need a renovator, hire a renovator. If you’re buying condos, look for someone who has delt with condominiums or managed condo-rental units in past.

4. How do you manage property?

This includes tenant selection, maintenance, accounting and reporting, how do you pay the proceeds to the investors? When?

5. Get references from other investors with similar types of property.
Call and ask the hard questions.

In the Edmonton yellow pages, there are about 150 property mangers listed.  Many Property Mangers restrict the number of properties that they handle, and many new investors discover that they can’t get a manager for the new single family home they bought.

Property Management Companies in Edmonton who do or have done single family units:

This list is not complete and we do not endorse or guarantee any of the companies therein. Please leave a comment if we’ve missed anyone and we’ll add it to the list.

Bermont Realty (St Albert)
Bella Management
Davies Management* (waiting list so please, don’t call)
Economy Management
Esquire Management
Inland Property Management
Kelly Management
Keywest Management
Kirkside Real Estate
Libertas Property Management
McCrea Management
Milligan Realty
Realty Canada Inc
Realty Corp
Oakwood Management (Fort Saskatchewan, ask for Don Grey)
Redford Management
TRC Management (Spruce Grove)
York West Asset Management

* I am the Broker for Davies Management.

If you property manager isn’t licensed, your money isn’t safe.

Many people don’t realize that property managers need to be licensed by the Real Estate Council of Alberta (RECA). When you’re considering a property manager, take the time to check your property manager’s licensing status. You can do this on RECA’s website.

If you’re in a Joint Venture (JV) Partnership as the Real Estate Expert and you use a non-licensed property manager you can be held liable for any losses. Working with professionals is an important part of your Real Estate Investment Business.

What license does a property manger need?

A property manager holds security deposits from your tenants. To be able to hold security deposits for someone else, they need a Broker’s Trust Account. Only a RECA certified broker can hold security deposits and rents from your tenants. There can also be a staff of property managers working under the broker, and they must be licensed as associates.

You need to check that your property management firm has a registered broker in good standing. You should ask them at the outset, but you should also do your own due diligence.

How Do I Use RECA to check on my Property Manager?

We’re going to start by checking out our friend Barry McGuire of the Ritchie Mill Law Office. He’s a lawyer and doesn’t have or need a real estate license. We shouldn’t be able to find him.

1. Go to the RECA website, www.reca.ca.

2. You want to click on Consumers and then we’re going to find the license search link in the top right.

To go straight to the search function click here.

3. Now there’s three options to search: last name, brokerage name and location. There are also some wildcard options if you’re not quite sure where you’re looking.

We’re going to start by searching for McGuire. Put the name in the first box and click the little globe button.

4. You’re going to get a result like this one below. You’ll notice there are no entries matching Barry McGuire or the Richie Mill Law Office. If Barry was claiming to be a property manager, we’d have a pretty big red flag.

5. Now we’re going to do the same thing again for myself (Brent Davies). We’re also going to use the wildcard function. Because some people spell Davies without the ‘e’ (Davis) we’re going to search for both of them by using the % wildcard. There’s an explanation of how to use these on the RECA search page.

The search result you will see will have a listing on it like this:

6. The second listing down is William Brent Davies. It tells you he is the broker for Davies Management & Realty, and his license is valid until September 2009. Your property management company must have a broker listed for that company, and they must have a little green circle next to them. The other options are a grey or black circle, and those should raise some red flags. If they’re not listed at all, they need to prove to you that money will be handled through an authorized broker’s trust account.

Other possible red flags that your Property Management firm might not be licensed:

- Mailing address is a post office (P.O.) box.

- Requesting payments (cheques or money orders) in a personal name or a name different than what’s on the license or management agreement

- Advertisements in a different name. This property manager is in a grey area and may be playing for multiple teams.

Where else should I look?

It’s also a great idea to check the Better Business Bureau (BBB). Good property managers also tend to be good corporate citizens. Make sure your property manger can provide good references, interacts with you in a professional way and is properly licensed.