How to Start a Property Management Business in Missouri


Steve Goldstein
Steve Goldstein
Business Formation Expert
Steve Goldstein runs LLCBuddy, helping entrepreneurs set up their LLCs easily. He offers clear guides, articles, and FAQs to simplify the process. His team keeps everything accurate and current, focusing on state rules, registered agents, and compliance. Steve’s passion for helping businesses grow makes LLCBuddy a go-to resource for starting and managing an LLC.

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Start a Property Management Business in Missouri

Are you considering starting a property management business in Missouri? This exciting opportunity offers numerous advantages, such as a growing market, recurring income, and the flexibility to set your own schedule. As more people move to Missouri with a current population of 6,204,710, the demand for professional property managers is increasing, making this an ideal time to explore this entrepreneurial venture. Furthermore, property management businesses tend to be more resilient to economic fluctuations, offering a stable and secure career path. This article will teach you the basic steps to start a property management business in Missouri.

Before diving into the world of property management, it’s essential to familiarize yourself with the necessary steps and requirements to establish a successful business in Missouri, popularly known as The Show-Me State. If you plan to register an LLC in Missouri for your property management business, the guidelines will be different from that of a corporate structure.

Prerequisites to Start Property Management Business in Missouri

In order to start a property management business in Missouri, several prerequisites must be met. First and foremost, you’ll need to obtain the necessary business licenses and permits required by your local government. This may include obtaining a real estate broker’s license, which often involves completing coursework and passing an exam. Additionally, you should familiarize yourself with the state’s specific landlord-tenant laws and regulations and any local zoning and building codes.

Prior experience in property management or real estate will be valuable, as well as strong communication, organizational, and customer service skills. Ultimately, establishing a solid network of industry professionals, such as contractors, attorneys, and real estate agents, will be crucial to the success of your property management business in Missouri.

The requirements include obtaining the relevant licenses and permits, understanding the state’s landlord-tenant laws, and building a strong network of industry professionals. By carefully planning your entry into this thriving industry, you’ll be well on your way to creating a thriving property management business that provides value to clients and contributes to Missouri’s housing market growth.

Property Management Business needs some special permits and expertise. It is recommended to consult any legal and industrial expert before you start processing your business registration in Missouri. Besides, checking with local governments and authorities is highly recommended.

– LLCBuddy Editorial Team

How to Start a Property Management Business in Missouri

In Missouri, opening a property management company can be challenging, with obstacles posed by laws and regulations. Finding the initial steps to establishing a property management firm might take time, given the many associates you need to consider. It should go without saying that this procedure may be difficult and occasionally expensive without the right advice and guidance to lead you in the correct direction.

Step 1: Get a Business Plan

Writing a business plan is of paramount concern and should be every person’s first move when starting a property management business. A business plan gives you a thorough overview of the enterprise, lists the goods and services your business will offer, and explains what need or requirement each will address. It is also heavily advised that a market analysis be included in your company plan.

Aside from the insight into the goods and services you offer, this furthermore aids in identifying your competitors, target market, and the reasons why they require the goods or services you will be offering. Don’t forget to include a thorough operations strategy and a financial plan outlining the finances required to establish the business and its source.

Step 2: Choose a Business Structure in Missouri

Understanding and choosing how to form a property management firm effectively is a crucial step in the entire process. To begin with, before you can run your property management business, you must decide what type of business structure you want. If you are forming a corporation, filing the Articles of Incorporation with the Secretary of State is a requisite. On the other hand, if you are forming an LLC, you need to file the Articles of Organization with the SOS.

Step 3: Get a Business Name in Missouri

Getting a business name is the most important part of giving your company its identity. The name of a property management company should strike a balance between being memorable and simple to understand. Besides, Missouri has its own regulations for naming your business. There are some Missouri LLC naming guidelines for LLCs. It’s best to check the Missouri Secretary of State’s website to check if your decided name is available. Once you have a name figured out, it’s also to check for a relevant domain name in case you want to direct clients to your website online.

Step 4: Assign Your Missouri Registered Agent

The next thing you need to do is get a Registered Agent. The Missouri Registered Agent is an individual or entity that handles your official and legal documents on your behalf. A Registered Agent will receive legal notices if your organization gets sued. You can be your own agent. However, it is good to appoint a professional service.

Step 5: Register Your Property Management Business in Missouri

The most crucial step is registering your property management business in Missouri. You must send the registration form to the Missouri Secretary of State by mail or online, whichever is available for your business. If you form an LLC, you must file the Missouri Articles of Organization and for the corporation, you must file Missouri Articles of Incorporation. Pay the filing fee to the Missouri Secretary of State while registering your business. For LLCs, the filing fee is $105 (by mail and $50 online) and for Corporations, the filing fee is $50 fo filing online, $105 for filing by mail.

Step 6: Apply for Missouri Business Licenses and Permits

You must obtain proper business licenses and permits for your property management business in Missouri. The license and permit types depend on the location (city/county) and the property you manage under your business. You must check with the Missouri Secretary of State. In Missouri, you do not need to obtain General License. Also, you do not need to get a Privilege License.

Step 7: Purchase Equipment For Your Missouri Property Management Business

The equipment you need to launch a property management business won’t be excessive. You might either set up a home office or rent office space. Both reliable transportation and access to editable contracts may be made possible by joining a legal website. Other tools include a printer, computer, smartphone, and fax machine.

Consider assembling a good set of tools to handle everything from electrical to plumbing issues if you intend to handle your repairs in-house. But be mindful of licensing regulations and construction codes. You’ll need to either order signs for the properties you manage or deal with a printer familiar with property signage to comply with state-specific standards.

Step 8: Market Your Missouri Property Management Company

Many property management firms in Missouri use online and offline marketing strategies. Social media can be useful, but you should be careful which platforms you choose based on your target market. LinkedIn might help you expand your network if you want to work with property owners.

Additionally, consider publishing a newsletter to send to property owners monthly or every three months. It might have informative pieces about the sector and endorsements from pleased customers. A recommendation program for real estate agents could also be established. You can send the agent a gift or referral money for each customer they suggest.

Apartment management may come to mind when you think of property management. The most prevalent property management business deals with apartments, condos, single-family homes, and multi-generational homes. Yet, Missouri is home to many successful property management firms.

Important Information

Cost to Start a Property Management Business in Missouri

When starting your own property management business, it’s important to determine the costs of your entire procedure, from the start-up until your operations. Things like one-time fees, startup costs, and ongoing expenses that you need to cover should be deeply discussed with your agent if you have one.

The LLC filing fee in Missouri is $105 (by mail and $50 online). If you start a corporation, the incorporation fee in Missouri is $50 fo filing online, $105 for filing by mail. The annual report filing fee in Missouri for LLCs is $7.

Getting the right insurance when starting out as a professional property manager is crucial to safeguard your company, yourself, and the properties you look after for other people.

Additionally, you might try applying for a government grant and obtaining a loan from a bank or a family member; however, you must be ready with a strong business plan and written payback terms. Company credit cards can also aid with purchases and fast cash flow, but be mindful of interest rates.

Why Start a Property Management Business in Missouri

  1. Growing demand: With an increasing number of people moving to Missouri, property owners are in need of professional property managers to handle their investments, resulting in a growing market for your services.
  2. Recurring income: Property management businesses generate consistent monthly income through management fees, allowing for predictable cash flow and financial stability.
  3. Low startup costs: Property management has relatively low startup costs compared to other businesses, as you don’t need a physical office space or significant inventory to get started.
  4. Potential for expansion: As your client base grows, so does the potential for expanding your business into other areas of real estate such as sales or development.
  5. Diverse clientele: Property management businesses in Missouri can cater to a wide range of clients, from individual property owners to large corporations and investment firms, providing you with a diverse customer base.
  6. Flexibility: Running your own property management business allows you to set your own schedule and work at your own pace.
  7. Resilience to economic fluctuations: Property management businesses are generally less affected by economic downturns, as people will always need housing, making it a relatively stable industry.
  8. Opportunities for networking and collaboration: Establishing relationships with other industry professionals, such as real estate agents, contractors, and legal experts, can lead to new business opportunities and referrals, helping to grow your business.
  9. Increasing property values: As Missouri continues to develop and attract new residents, property values will likely increase, providing potential long-term financial benefits for you and your clients.
  10. Personal satisfaction: Running a successful property management business in Missouri allows you to make a meaningful impact on your clients’ lives and the broader community by providing well-maintained, safe, and comfortable housing options for residents.

FAQs

What are the licensing requirements for starting a property management business in Missouri?
All property managers in Missouri must have a real estate broker’s license issued by the Missouri Real Estate Commission. In order to obtain a license, applicants must complete a pre-license education course, pass a licensing examination, and submit fingerprints for a criminal background check.
What are the legal requirements for setting up a property management business in Missouri?
Property management businesses in Missouri must register with the Missouri Secretary of State, obtain a business license from the local municipality, and secure any other necessary permits or licenses. Property managers must also abide by the Missouri Landlord-Tenant Law and the Fair Housing Act.
What are the taxes and fees associated with starting a property management business in Missouri?
Property management businesses in Missouri must pay income taxes, payroll taxes, and local sales taxes. Property managers may also be subject to franchise taxes, property taxes, and other taxes and fees depending on the services they provide.
What services are typically provided by a property management business in Missouri?
Property management businesses in Missouri typically provide services such as tenant screening, rent collection, maintenance and repairs, and eviction services. Property managers may also provide additional services such as budgeting and accounting, marketing and leasing, and legal advice.
Are there any special regulations for property management businesses in Missouri?
Yes, property management businesses in Missouri must comply with the Missouri Landlord-Tenant Law and the Fair Housing Act. Property managers must also abide by any local laws, such as city ordinances or county zoning regulations.
Is it legal to charge a fee for property management services in Missouri?
Yes, property management businesses in Missouri are allowed to charge a fee for their services. However, the fee must be reasonable and disclosed to the tenant in writing.
What licenses are required to start a property management business in Missouri?
An individual property manager in Missouri must have a real estate broker’s license. In addition, they may be subject to local business licensing requirements.
What are the requirements to obtain a real estate broker’s license in Missouri?
To obtain a real estate broker’s license in Missouri, an individual must be at least 18 years of age, have a high school diploma or equivalent, and complete the required pre-licensing education and pass the real estate broker’s licensing exam.
What are the legal requirements for a property management business in Missouri?
A property management business in Missouri must be registered as a legal entity with the state, such as a corporation or limited liability company (LLC). They must also obtain a business license from the local jurisdiction, as well as any other necessary permits or licenses to operate.
What type of insurance do I need to have as a property management business in Missouri?
Property management businesses in Missouri should have liability insurance to protect against any claims of negligence in the performance of their duties. They should also consider obtaining errors and omissions insurance and bond insurance.
Are there any special regulations I need to follow when managing rental properties in Missouri?
In Missouri, all rental properties must follow the terms of the Missouri Landlord-Tenant Law, which includes provisions pertaining to security deposits, rent increases, tenant rights, and more. Property managers should be familiar with all local and state laws pertaining to rental properties.
What licenses do I need to start a property management business in Missouri?
In Missouri, you need an administrative license if you are managing five or more residential housing units, and a real estate broker license if you are managing five or more commercial units.
What is the cost to start a property management business in Missouri?
The cost to start a property management business in Missouri depends on the licensing requirements, business structure, and other start-up costs such as insurance, office space, and equipment.
How do I market my property management business in Missouri?
You can market your property management business in Missouri by creating an online presence, utilizing social media, networking with other local property owners, and attending local real estate events.
What types of insurance do I need for my property management business in Missouri?
You will need general liability insurance, and may need additional coverage such as Errors & Omissions insurance and Workers’ Compensation insurance, depending on the size and type of your business.
Where can I find property owners to manage in Missouri?
You can find property owners to manage in Missouri by networking with other local property owners, attending local real estate events, and utilizing online marketing tools such as creating a website or utilizing social media.
What are the business registration requirements for a property management business in Missouri?
Property management businesses operating in Missouri must register with the Department of Revenue and obtain a Missouri Business Tax Identification Number.
Is it necessary to register a trade name for a property management business in Missouri?
Yes, it is necessary to register a trade name if the business will operate under a fictitious name.
What type of insurance is needed to operate a property management business in Missouri?
Property management businesses in Missouri must carry liability insurance for any damages caused to tenants or property. It is also recommended to carry Errors and Omissions insurance to cover any potential negligence or wrongdoing.
Are there any specific state laws governing property management in Missouri?
Yes, there are several state laws governing property management in Missouri, including the Landlord-Tenant Law and the Real Estate Licensing Law.
What are the tenant screening requirements for landlords in Missouri?
Landlords in Missouri have the right to conduct criminal background checks, credit checks, and eviction history checks on prospective tenants.
Are there specific rental regulations in Missouri?
Yes, the state of Missouri has specific regulations regarding rental agreements, security deposits, rent increases, and tenant rights.
Does Missouri allow tenants to withhold rent under certain circumstances?
Yes, tenants in Missouri may withhold rent if the landlord fails to make necessary repairs or fulfill other obligations listed in the rental agreement.
Are there limits on late fees and other fees for tenants in Missouri?
Yes, Missouri has a cap on late fees, which cannot exceed 10% of the monthly rent. Other fees, such as pet deposits or cleaning fees, may not exceed the actual cost of the service provided.
What rights does a tenant have if their landlord fails to comply with state regulations?
Tenants in Missouri have the right to withhold rent or break the lease if the landlord fails to comply with state regulations.
Are landlords in Missouri required to provide tenants with a copy of the lease?
Yes, landlords in Missouri must provide tenants with a written copy of the lease prior to the tenant moving in.
Are there limitations on how much a landlord can charge for a security deposit in Missouri?
Yes, landlords in Missouri are limited to charging no more than two months’ worth of rent for a security deposit.
Must landlords in Missouri have written rental agreements?
Yes, landlords in Missouri must provide tenants with a written rental agreement.
Are landlords in Missouri required to provide tenants with a notice of entry?
Yes, landlords in Missouri must provide tenants with at least 24 hours’ notice prior to entering the rental unit.
Are there specific regulations for terminating a lease in Missouri?
Yes, there are specific regulations for terminating a lease in Missouri, including giving notice, returning the security deposit, and providing the tenant with a final move-out inspection.
Are landlords in Missouri required to provide tenants with a written notice of eviction?
Yes, landlords in Missouri must provide tenants with a written notice of eviction prior to filing an eviction action in court.
Are there any special regulations for landlords in Missouri who own more than three rental units?
Yes, landlords in Missouri who own more than three rental units must register with the state and obtain a Rental Property Owner License.
What is the process for filing a complaint against a landlord in Missouri?
Tenants in Missouri can file a complaint against a landlord with their local housing authority or the Missouri Department of Health and Senior Services.

Also Read

Why Missouri Property Management Business is So Important

Missouri property management businesses play a crucial role in ensuring that properties are well-maintained, tenants are satisfied, and owners can maximize their investment. These businesses act as a bridge between property owners and tenants, taking care of all the day-to-day responsibilities that come with managing real estate.

One of the key reasons why Missouri property management businesses are so important is their ability to handle the complexities of property management. From tenant screenings and lease agreements to maintenance and repairs, property management businesses in Missouri are well-versed in the ins and outs of the industry. By taking care of these tasks, property owners are free to focus on other aspects of their investment, such as expanding their portfolio or seeking out new opportunities.

Furthermore, property management businesses in Missouri are invaluable when it comes to tenant relations. Experienced property managers have the skills and expertise to handle tenant inquiries, complaints, and emergencies in a professional and timely manner. This can go a long way in ensuring that tenants are happy and satisfied with their living arrangements, leading to longer lease agreements and lower turnover rates.

Another reason why Missouri property management businesses are so important is their ability to maximize the value of a property. By keeping properties well-maintained, handling tenant issues promptly, and staying up-to-date on market trends, property managers can help property owners achieve the highest possible return on their investment. This value-added service is especially crucial in a competitive market like Missouri, where property owners need every edge they can get to stay ahead of the curve.

Additionally, property management businesses in Missouri can also provide a layer of protection for property owners. With their knowledge of local laws and regulations, property managers can help ensure that owners are in compliance with all legal requirements. This can help prevent costly fines or legal disputes down the road, saving property owners time, money, and headaches.

In conclusion, the importance of property management businesses in Missouri cannot be overstated. These businesses play a vital role in the success of property owners and the satisfaction of tenants, while also maximizing the value of properties and providing a layer of protection for owners. As the real estate market in Missouri continues to grow and evolve, property management businesses will only become more essential in ensuring that properties are well-maintained, profitable, and in compliance with all laws and regulations.

Conclusion

In an expanding market, learning how to launch a property management firm in Missouri can be a low-risk, high-reward endeavor. There may be few entry barriers and inexpensive startup costs for this profession. All things considered, for the right businessperson, launching a property management firm in Missouri may be a satisfying and successful endeavor. The LLCBuddy Editorial Team recommends that you must take legal consultation before starting any business in Missouri.

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