Are Property Management Companies Regulated? 11 Renting Regulations to Know

Renting out your property is so much more than a business transaction. You’re sharing a place you care about, and you want to see it protected. But you’re also providing your residents with something very important — a home.

That’s why property management, and landlordship, is so tightly regulated in the United States. These rules ensure that residents get a safe, peaceful place to live, and that the home you’ve invested in is well taken care of. 

If you’ve ever wondered, “Are property management companies regulated?”, the short answer is yes. Property management companies (and self-managing property managers) are subject to laws governing both landlords as well as all businesses operating in the United States. Regulations vary a lot from state to state, but here are some of the most important federal regulations to know. 

1. Prospective residents are protected from discrimination

Passed in 1968, the Fair Housing Act prevents choosing — or denying — residents the opportunity to rent a home on the basis of: 

• Race and ethnicity
• Gender or sexual orientation
• Religion
• Marital status
• Whether or not they are disabled
  

Hopefully, this is common sense for most property managers in 2022. But it’s still one of the most important rental regulations in the United States. Belong ensures all residents are given a fair shot at a home by approving qualified renters on a first-come, first-served basis.

2. Residents must be informed if they were rejected due to their credit history 

Access to credit information is important to help you find reliable, financially secure residents. But this sensitive information should ideally be used with applicants’ full, informed consent. 

Under the Fair Credit Reporting Act (1970), landlords do not technically need tenants’ permission to access their credit reports and scores. However, getting permission is more considerate, and generally appreciated by renters. Regardless, property managers will need to let residents know if they were rejected for tenancy because of their credit history. Belong communicates directly with prospective residents on the homeowner's behalf, so homeowners can rest assured that all regulated communications are happening automatically.

3. Service animals must be allowed in rental homes 

When it comes to the question, “Are property management companies regulated?”, the answer is straightforward when it comes to allowing animals in a property. You don’t need to allow pets in your rental home. But according to the Americans With Disabilities Act (1990), you do need to allow service animals, like guide dogs.

As long as the animals comply with local laws like licensing and vaccinations, property managers cannot preclude residents who rely on these important furry friends. 

4. Property managers cannot restrict children in a home

As part of the Fair Housing Act, managers cannot discriminate against applicants with children when looking for residents to live in your rental home. 

Not only are you unable to limit families with children from renting your home, but you also can’t keep certain rooms off limits and restrict children to specific areas of your rental. So, if you have any valuable or breakable items on the property, you’ll likely want to put those in storage before residents move in.

5. Property managers can choose renters of their own free will 

As long as they aren’t discriminating against protected groups, property managers can choose residents at their own discretion. That includes following whatever criteria they like, such as employment history, rental history, or income level. Typically, as long as your standards are reasonable and grounded in reducing financial risk, you don’t need to worry about discrimination.

Belong works hard to find quality residents that meet income and credit thresholds, then takes care of those residents from day one, ensuring they treat your property like home.

6. Property managers may charge a security deposit of their choosing

While this is not a federal regulation, property managers are allowed to charge a security deposit in every state. Belong's required security deposits vary by market.

7. A legal eviction process is required to remove a renter

No matter how late on rent a resident is, or how much they’ve damaged your property, you can’t simply change the locks or tell them to vacate the home. This is considered “taking the law into your own hands,” rather than going through proper, legal channels. 

Instead, you will need to follow your own state’s established processes for eviction. Any experienced and trustworthy property manager will agree. If the need to evict a resident from a home managed by Belong, we will work with you to make it as painless and fair of a process as possible.

8. The home must be in safe, clean, livable condition

When asking the question, “Are property management companies regulated?”, regulations around the condition of a home should really be common sense. Your residents are looking for an enjoyable living space, and as a landlord or property manager, it’s your job to provide that. 

Belong makes this easy for homeowners, because all Belong homes are maintained by full-time, in-house Belong Pros that are on-call 24/7 to handle maintenance emergencies and ensure your residents are well taken care of.

9. Tenants have the “right to quiet enjoyment”

Your property manager will likely need to visit your rental home on occasion. But they’ll need to give your residents plenty of notice, and they can’t show up without a good reason. 

10. Property management companies and landlords must be properly licensed 

Just like any other business, property managers need to comply with their state and region’s licensing regulations. In some states, that could mean a property management license, and in others, a real estate broker’s license. 

11. Property management companies must follow state and federal business regulations

Every business in the United States needs to follow certain rules to operate ethically — and that includes property management companies. A few of the most important are paying your taxes, complying with labor laws, and registering for an Employer Identification Number (EIN). 

Renting is about relationships 

We’ve now explored the question, “Are property management companies regulated?” and walked through 11 regulations. These legalities protect both you and the residents of your rental home. But for homeowners and managers who want to go above and beyond, these regulations should be considered the bare minimum. 

Renting out your home is all about making sure residents feel welcome, supported, and comfortable in their living space. Often, homeowners who excel in this area will be rewarded with reliable, committed renters who take care of the home as if it was their own. 

The property management companies of yesterday were too often inefficient and not human-focused, viewing renting as nothing more than a financial transaction. 

Today, modern alternatives to the property management company have emerged. These platforms, like Belong, leverage technology and put service first, creating a better experience for both owners and residents. 

Are you a homeowner looking for a better way to manage your property? Learn more about Belong and find out if your home qualifies today.