What form should I use to list a property for rent?
QUESTION: Several years ago I represented a buyer on the purchase of her home. She now wants me to help her find a new one. Instead of selling her current property, she wants to keep it and hire me to list it for rent. Is there a form I can use to advertise her house for rent?
ANSWER: Yes. Standard Form 405-T (“Exclusive Right to Advertise Agreement”) was released in July 2019 for just this kind of situation. The form addresses a range of issues agents may encounter in listing a property for rent, including what lease terms the landlord desires and what compensation will be paid for brokerage services. Form 405-T makes clear that the broker will not mange the rental property after it is leased. Form 106 (“Agreement to Procure Tenant”) will not work here because that form is an addendum that can only be used with Form 101 (“Exclusive Right to Sell Listing Agreement”).
Agents should note that Form 405-T provides an option for the broker to secure a tenant in addition to advertising the property for rent. This option is located on the second page of the form and requires the parties to check a box if the landlord wishes for the agent to perform this service. The form explains that securing a tenant includes, but is not limited to, the broker’s “soliciting tenant applications, running background or credit checks on prospective tenants, and completing a pre-printed standard form rental agreement for tenant and delivering such lease to Owner.”
The process of securing a tenant should not be taken lightly. Article 11 of the Code of Ethics states that REALTORS® shall only offer services if (1) they are competent to do so or (2) obtain the assistance of someone who is competent. Since you have never worked with rental property or tenants before, you should only offer to secure a tenant for this client if you have someone assist who is competent to guide you through the process. Otherwise, you should limit your activities to marketing the property for rent and referring any prospects to the landlord.
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