A property management agreement is the signed contract that sets what your manager does, what you pay, how much authority they have and how either side can end the relationship. In Nevada it has to be in writing, and it has to cover certain items by law. Read it as an operating document for your building, not paperwork to initial and file.
Most owners compare managers on price and personality, then sign whatever is put in front of them. The agreement is where the real terms live. This guide covers what Nevada requires, the clauses an apartment owner should check, and how to get out if it goes wrong.
What Does Nevada Require in a Property Management Agreement?
Nevada requires a signed written agreement before a broker can manage your property. Under NRS 645.6056, a real estate broker with a property management permit cannot act as property manager until both the broker and the client have signed one. The statute also lists what it must include.
Paraphrased, the agreement must cover:
- The term, and if it renews, the circumstances and the length of each renewal.
- How resident deposits are retained and handled during the term and any renewal.
- The fee or compensation the broker is paid.
- How far the broker can act as your agent.
- If the agreement can be cancelled, the circumstances in which it can. It may allow you, the broker or both to cancel with cause, without cause or either.
- If the broker will provide asset management, how far those services go.
That is a floor, not a full contract. The statute says "without limitation," so a good multifamily agreement goes further. Rules change, so check the current text and have your attorney review the document. This article is general information, not legal advice.
A separate section, NRS 645.6057, sets the manager's duties while performing the agreement. Those include disclosing each source of compensation, using reasonable skill and care, and accounting for your money as soon as practicable.
What Clauses Should an Apartment Owner Look For?
Look for clauses that define scope, money, authority, reporting, insurance and exit. A single-family template often skips the parts that matter in a 40-unit building. These are the ones to read twice before you sign.
Scope of Services
List what the manager actually does: leasing, rent collection, maintenance coordination, vendor oversight, unit turns, resident communication and month-end reporting. Anything vague, such as "general management," invites arguments later. Note what is excluded, like construction oversight, lease-up marketing or accounting, and whether those are separate agreements. Our multifamily property management service shows how a full scope can be laid out.
Fee Structure
The statute requires the fee in the agreement. You want the full picture, not just the headline percentage. Ask for every charge in writing: the base fee, leasing or renewal charges, set-up or onboarding costs, maintenance markups, project or construction fees, and charges at termination. If a fee is not in the agreement, ask why. Compare structures, not just rates.
Authority Limits
The statute makes you define how far the broker can act as your agent. In practice, set a dollar limit the manager can spend without your approval, and require approval above it. Carve out emergencies, like a burst pipe or a failed boiler, where the manager can act first and tell you right away. Also state who signs leases, who approves vendors and whether the manager can hire affiliated companies. If so, it should be disclosed.
Reserves and Owner Funds
Say how much operating cash the manager holds back and where it sits. Nevada requires brokers to keep client money in a separate trust account and balance it at least monthly (see NRS 645.310). Your agreement should match that: no commingling, clear records of whose money is whose, and a stated timeline for sending you your distribution each month.
Reporting and Access
Decide what you will see and when. A solid agreement names a monthly package with the rent roll, income and expense statement, delinquency report, and notes on maintenance and vacancies. It also gives you the right to see the books and bank activity for your property. If you cannot get numbers, you cannot manage the manager.
Insurance and Liability
The agreement should require the manager to carry appropriate coverage and name you as an insured where it makes sense. It should also say who is responsible if the manager's mistake costs you money, and whether you must indemnify the manager. Have your insurance broker read this section, not only your attorney.
Resident Deposits
Nevada requires a deposit provision. Spell out where resident deposits are held, who is accountable for them and how they transfer if the agreement ends. This is the clause that causes the most pain at a handoff when it is silent.
How Do You Terminate a Property Management Contract?
To terminate a property management contract, follow the cancellation clause exactly: give written notice, in the way the agreement requires, within the notice period. Then plan the handover. Nevada's statute says the agreement must set out when it can be cancelled, which is why that clause matters so much on day one.
Check these points before you send a notice:
- Cause or no cause. Can you leave only for a defined reason, or at any time? The statute allows either approach, so it comes down to what you signed.
- Notice period. How many days, and does the clock run from sending or receipt?
- Early exit costs. Is there a termination fee, a minimum term or a payout of future fees? Understand these before you commit, not after.
- Handover duties. What must the manager deliver, and by when?
- Money still in flight. How are final owner funds, held reserves and the last month's reconciliation handled?
If you are already weighing a change, read when to switch property management companies first. When you are ready to move, a structured property management takeover keeps rent flowing while leases, deposits and bank accounts change hands.
What Should the Transition Clause Cover?
The transition clause should list exactly what the old manager hands over and when. Without it, you negotiate from a weak position at the worst moment. Ask for these items to be named in the agreement:
- Resident deposits, with a ledger showing each resident's amount.
- Current leases, applications and renewal dates.
- Rent roll, resident ledgers and delinquency records.
- Vendor contracts, warranties, keys and access codes.
- Maintenance history, open work orders and inspection records.
- Bank and trust account reconciliation through the last day.
Set a firm deadline, not "promptly." Settle who pays for the work of the transfer, too.
Is a Property Management Contract Template Enough?
A template is a starting checklist, not a finished agreement. Most free templates are written for single-family rentals, so they under-cover the things that matter in apartments: unit turns, vendor approval limits, resident communication, trust accounting for many residents and monthly owner reporting.
If you use a property management contract template, test it against the sections above. Does it name the fee structure, the spending limit and the reserve? Does it match what Nevada requires in NRS 645.6056? Does it let you cancel on terms you can live with? Fill the gaps and bring in your attorney. Treat any download as a draft.
Our free property management contract template is written for Nevada apartment buildings. It has a section for each item NRS 645.6056 requires, a single fee schedule, a spending limit and a handover checklist. It is still a draft to adapt with your attorney.
Red Flags to Raise Before You Sign
Watch for these, and ask about every one:
- A long term with no exit. Multi-year terms with termination only for narrow cause.
- Fees that live outside the agreement. "Per our fee schedule" with no schedule attached.
- Unlimited spending authority. No dollar cap on purchases or repairs.
- No reporting standard. "Reports as requested" instead of a monthly package.
- Automatic renewal that is easy to miss. A short window to give notice before it rolls over.
- Silence on deposits and records. No transition language at all.
Compare any answers against the questions in our list of questions to ask a property manager. If you are still choosing, how to choose a property management company walks through the full process. A good manager will welcome the conversation and explain each clause. A manager who rushes you past the contract is telling you something.
Read It Like Your NOI Depends on It
It does. Fees, authority, reporting and exit terms all land on your net operating income and your control of the asset. Read the whole agreement, mark every clause that surprises you and ask for changes in writing. Have your attorney review the final version, because Nevada law can change and your property has its own facts.
Then keep it. File the signed agreement where you can find it, and put the renewal and notice dates in your calendar. You will be glad you did.
