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Guest Blog: PSA for Lifestyle Management Companies!

September 05, 2019 1:25 PM | Katharine Giovanni (Administrator)

By ICLMNet Member Leslie Spoor

For those of us who have been in business for a few years, you likely know that Lifestyle Management is basically an unregulated service.

There are no laws specific to our industry or any conditions we have to meet other than those general small business requirements for all companies.

Likewise, as there are a myriad of service offerings under the Lifestyle Management umbrella, it has been difficult to pin us down. Not for insurance. Not for Worker's Comp classifications. Not for labor standards (assuming your employees work part-time).

This industry has been free-wheeling it since it first became an industry around 2000-ish which has been both a blessing and a curse. It's a blessing because we have few, if any laws with which we must comply. And it's a curse because it makes getting insurance and other business prerequisites nearly impossible.

Of particular interest are those of us who offer absentee home checks as part of our services. These checks may be called home watch or vacation rental support assistance or a variety of other nomenclature.

When we do home checks, typically we are doing no more than a real estate agent in that we are accessing the home, doing a visual inspection, reporting anomalies and coordinating preventative maintenance or repair services.

Confusion comes in when someone uses the word 'property management'.

On the one hand, yes, we all manage properties. On the other, we are not promoting rentals (at least I hope YOU'RE not!). Therefore, in our lifestyle management vernacular, a home check is NOT property management.

This is a slippery slope as the definition of property management can be interpreted in so many ways. True property management is defined as:

"A property manager or estate manager is a person or firm charged with operating a real estate property for a fee, when the owner is unable to personally attend to such details, or is not interested in doing so."

This definition means taking rental payments, screening guests, posting ads for rentals, understanding local laws related to rentals, taking guest payments, etc.

Recently the Home Watch Association (a directory group) emailed out an alert and I believe this alert is serious enough that you should know about it and therefore can take the appropriate action to protect your business.

Apparently (and I'm paraphrasing/summarizing), the Nevada Real Estate Division challenged the 'home check' companies taking their complaint all the way to the Nevada Attorney General.

The Real Estate Division demanded that all 'home check' companies operate under a real estate broker because they took the word 'home check' to mean 'property management' in its true sense (managing rentals).

Because of the realtor demands, all business owners who owned home check companies received a 'cease and desist' notice, effectively stopping their businesses cold.

The entire story is long and ran from 2016 to 2019, but I wanted to give you the synopsis and what you can do to protect yourself.

According to the Home Watch Association, the official acceptable definition of a home watch service is: "A visual inspection of a home or property, looking for obvious issues."

Apparently this definition protected the Home Watch industry in Nevada and the Attorney General opted not to pursue the Real Estate Division's complaint.

Let me be clear about this: My own Lifestyle Management Company does take care of rentals but WE DO NOT advertise the rental, scrutinize guests, take deposits, manage payments or do anything related to an actual property management company.

What we offer is rental support services: we greet guests, check for damages post guest, schedule housekeeping and handyman services, etc. We are the company on the ground to support the rental but we do not do rentals themselves.

And of course, as a standard service, we offer home checks because a huge percentage of our clients are snowbirds or have a vacation home here.

We agree with the Home Watch Association that if you offer absentee home services or rental SUPPORT services, then you should add the definition of the home watch (as indicated above) to your website and you should avoid using the words Property Management on your website and in your marketing materials (unless you actually do offer rental services).

By the time you read this, my own website will have been updated to reflect this statement as a precautionary action. Doing business in CA is tough on a good day and impossible a great deal of the time. When/if someone tries to regulate our industry, this will likely be the first place it happens (she says with a wistful irony).

As this industry continues to grow, it is only a matter of time before people will try to regulate it. Especially because there is so much money to be made! Can you imagine what it would generate in revenue for the real estate industry if we all had to go to real estate classes, take the real estate exams AND had to pay a percentage of our income to a broker? Egad! No thank you.

Take a moment to review your website. If you offer absentee home checks or rental support services, be sure you don't use the words Property Management anywhere. And do take a moment and add the home watch definition recommended above.

If you'd like more info or are unsure what category you fall into or what to say to help protect your business, by all means, give me a call -- 760-898-9604 -- and I'll help you out.

And don't forget -- we offer a concierge data collection software system that can save you up to 20 hours per week of data management! That will help you have plenty of time to promote your business and do tasks that actually further your goals!

Sign Up today for a demo or to get your database* NOW. For more info: 760.898.9604 or email!

*Note: The database requires an ongoing $125/mo license fee. The $300 is the setup fee plus all the documents as described.

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