How to Start a Property Management Company
Opening a property management company, from licensing questions for your state to the first monthly invoice an owner pays.
A property management company starts with your state's licensing rules, a written agreement with each owner, the company set up with its own tax ID and bank account, insurance, and then the first monthly invoice. Management fees, repair pass-throughs and leasing fees on owner invoices are explained in the property manager invoicing guide linked below.
Before signing your first owner, find out from the state real estate commission whether managing other people's property calls for a broker's or a property management license.
On the role, the BLS profile of property, real estate, and community association managers (In the US, last modified August 27, 2026) says they "oversee many aspects of residential, commercial, or industrial properties." It adds that they "handle the financial operations of the property, making certain that rent is collected and that mortgages, taxes, insurance premiums, payroll, and maintenance bills are paid on time."
Worked example, with sample figures: a first owner invoice covers management of 3 units at $95.00 a unit, 3 × $95.00 = $285.00, plus one leasing fee of 1 × $450.00 = $450.00, for $285.00 + $450.00 = $735.00. Use your own figures; these are only an illustration.
Step-by-step startup guide
Follow these steps to launch your property manager business on solid footing.
- 1
Ask your state's real estate commission
Find out from your state's real estate commission which license, if any, applies to managing property for others before you take on an owner.
- 2
Write the management agreement
Set out the fee, the services covered, how repairs are approved and when owners get statements, and have a lawyer review the agreement.
- 3
Register the company
The SBA's launch guide (In the US, SBA, checked October 31, 2026) says "Register your business to make it a distinct legal entity."
- 4
Get an EIN and keep owner money separate
The IRS EIN page (In the US, IRS, last reviewed or updated October 16, 2026) says "You never have to pay a fee for an EIN." Your state's real estate commission can say how rent and deposits you collect for owners are to be held.
- 5
Arrange insurance
The SBA's launch guide (In the US, SBA, checked October 31, 2026) says "Some states also require additional insurance." A licensed agent can compare professional and general liability cover for management work.
- 6
Send the first owner statement and invoice
At month end, report what was collected and spent and invoice your fee. The property manager invoicing guide covers fees and pass-through costs.
Tips for starting your property manager business
- Keep repair receipts with the property they belong to. The IRS recordkeeping page (In the US, IRS, last reviewed or updated May 1, 2026) says "You may choose any recordkeeping system suited to your business that clearly shows your income and expenses."
- Budget for estimated tax. The IRS estimated taxes page (In the US, IRS, last reviewed or updated September 25, 2026) says sole proprietors "generally have to make estimated tax payments if they expect to owe tax of $1,000 or more when their return is filed."
- Get each owner's approval limit for repairs in writing before the first maintenance call.
- Send owner statements on the same day each month.
How Billed helps you get started
Features to look at as you set up your business.
Recurring Invoices
Billed's features page says: "Save time by sending invoices on a regular schedule so you don’t have to create invoices again and again."
Manage Multiple Businesses
Billed's features page says: "Manage multiple businesses in one place and save your time by keeping things centralized."
Expense By Category
Billed's features page says: "Get expense report by category to help your accountant in filing taxes."
Client Report
Billed's features page says: "See invoices, payments and time to pay in customer reports."
Frequently asked questions
Bill Your First Property Owner
Create invoices, track payments and keep your clients' details in one place with Billed.
At a glance
| Step | Who to ask | Dated source |
|---|---|---|
| Licensing | Your state's real estate commission | Your state's commission |
| Registration | State business filing office | SBA launch guide (In the US, checked October 31, 2026) |
| Tax ID | IRS EIN application | IRS (In the US, last reviewed or updated October 16, 2026) |
| Insurance | A licensed agent | SBA launch guide (In the US, checked October 31, 2026) |
| First owner invoice | Statement and fee | Property manager invoicing guide |
When this isn't for you
Written for people opening their own management company. Onsite managers employed by an owner or a management firm follow their employer's setup.