Commerce, Real Estate

Rule R162-5

Property Management

Notice of Proposed Rule

(Repeal)

DAR File No.: 34198
Filed: 11/01/2010 03:51:16 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The substantive elements of this rule have been incorporated into the proposed new Rule R162-2f. Therefore, this rule is no longer needed. (DAR NOTE: The proposed new Rule R162-2f is under DAR No. 34191 in this issue, November 15, 2010, of the Bulletin.)

Summary of the rule or change:

The rule is repealed in its entirety.

State statutory or constitutional authorization for this rule:

• Subsection 61-2f-103(1)(a)

Anticipated cost or savings to:

the state budget:

Where the substantive provisions of this rule are incorporated into the proposed new Rule R162-2f, no fiscal impact to the state budget is anticipated from this filing.

local governments:

Where the substantive provisions of this rule are incorporated into the proposed new Rule R162-2f, no fiscal impact to local governments is anticipated from this filing.

small businesses:

Where the substantive provisions of this rule are incorporated into the proposed new Rule R162-2f, no fiscal impact to small businesses is anticipated from this filing.

persons other than small businesses, businesses, or local governmental entities:

Where the substantive provisions of this rule are incorporated into the proposed new Rule R162-2f, no fiscal impact to affected persons is anticipated from this filing.

Compliance costs for affected persons:

In repealing this rule, the division and commission relieve affected persons of any obligation to comply with it. There are no compliance costs.

Comments by the department head on the fiscal impact the rule may have on businesses:

No fiscal impact to businesses is anticipated from this rule repeal as the substance of these provisions is contained in the new Rule R162-2f proposed by the Division.

Francine A. Giani, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Commerce
Real Estate
160 E 300 S
SALT LAKE CITY, UT 84111-2316

Direct questions regarding this rule to:

• Jennie Jonsson at the above address, by phone at 801-530-6706, by FAX at 801-526-4387, or by Internet E-mail at [email protected]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

12/15/2010

This rule may become effective on:

12/22/2010

Authorized by:

Deanna Sabey, Director

R162. Commerce, Real Estate.

[ R162-5. Property Management.

R162-5-1. Definition.

5.1. For purposes of this rule, property management requiring a real estate license includes advertising real estate for lease or rent, procuring prospective tenants or lessees, negotiating lease or rental terms, executing lease or rental agreements, collecting rent and accounting for and disbursing the money collected, arranging for repairs to be made to the real estate, and all other acts listed in Section 61-2-2(13)(a). It does not include the leasing or management of surface or subsurface minerals, or oil and gas interests, which is separate from a sale or lease of the surface estate.

 

R162-5-2. Exemptions.

5.2. The following individuals are not required to hold active real estate licenses to engage in property management:

5.2.1. Owners. An owner of real estate who manages his own property;

5.2.2. Employees. A regular salaried employee of an owner of real estate who manages property owned by his employer;

5.2.3. Apartment Managers. An individual who manages the apartments at which he resides in exchange for free or reduced rent on his apartment.

5.2.4. Homeowner's Association Employees. A full time salaried employee of a homeowner's association who manages units subject to the declaration of condominium which established the homeowner's association.

 

R162-5-3. Property Management by Real Estate Brokerage.

5.3. All property management performed by a real estate brokerage which has not obtained a separate property management company registration, or any licensees or unlicensed assistants affiliated with the brokerage, shall be done under the name of the brokerage and not under a separate business name.

5.3.1. All property management activities by a sales agent or associate broker affiliated with a principal broker shall be actively supervised by that principal broker. In the case of a branch office, the branch broker shall also actively supervise the licensees and unlicensed assistants affiliated with that branch.

 

R162-5-4. Property Management by Separate Property Management Company.

5.4. A separate property management company registration must be obtained in order to conduct property management business under a name different than that of the real estate brokerage.

5.4.1. The business of a separate property management company shall be exclusively property management. No real estate sales activity may be conducted by a property management company.

5.4.2. A license to operate a property management company will be granted upon compliance with the following conditions:

5.4.2.1. Application. Submission of the property management company application form required by the division, signed by an actively licensed principal broker, together with the proper application fees.

5.4.2.2. Business Name Approval. Compliance with the name approval provisions in R162-2.3. in the case of a principal broker who registers the name of his property management company with the division or R162-2.4. in the case of a property management company registration issued to a corporation, partnership, Limited Liability Company or association.

5.4.2.3. Property management by unlicensed principals or owners prohibited. Individuals who are principals or owners of a corporation, partnership, Limited Liability Company or association which is issued a property management company registration shall not engage in activity which requires a license unless they are licensed with the division and properly affiliated with the management broker for the corporation, partnership, Limited Liability Company or association.

5.4.3. The principal broker shall sign and submit the forms required by the division to affiliate with the property management company of each associate broker, branch broker and sales agent who will conduct property management services for the property management company.

5.4.4. Support Services Personnel. Individuals who are employees of a property management company may perform the following services under the supervision of the principal broker without holding active real estate licenses: providing a prospective tenant with access to a vacant apartment; providing secretarial, bookkeeping, maintenance, or rent collection services; quoting predetermined rent and lease terms; and filling out pre-printed lease or rental agreements.

5.4.5. Supervision. All property management activities by an associate broker or sales agent affiliated with the management company and all activities on behalf of the company by support services personnel shall be actively supervised by the principal broker of the company. In the case of a branch office, the branch broker shall also actively supervise the licensees and support services personnel affiliated with that branch.

 

KEY: real estate business

Date of Enactment or Last Substantive Amendment: April 23, 1998

Notice of Continuation: April 18, 2007

Authorizing, and Implemented or Interpreted Law: 61-2-5 ]