What a Management Company Should and Shouldn't Decide

TL;DR: A management company should handle tenant communication, routine repairs under a set dollar threshold (often $300-$500), and vendor scheduling. It shouldn't unilaterally approve capital projects, sign multi-year contracts, or make eviction decisions without written owner consent. The line belongs in your management agreement, not in a phone call after the fact.

_Last reviewed: July 2026 · 7 min read_

You hired a management company to make your life easier, not to hand over the keys to every decision on the property. The confusion usually shows up the first time a $4,000 roof estimate lands in your inbox with the work already scheduled. Here's how to draw the line before that happens.

Okoniq Property Hub keeps a running log of every repair and its cost, so owners and managers can see who approved what and when, without digging through email threads.

What repairs can a management company approve on its own?

A management company should be able to approve small, urgent repairs without calling you first, and most agreements set that limit between $250 and $500 per item. This covers things like a leaking faucet, a broken garbage disposal, or a tripped breaker, none of which can wait for a signature.

The logic is simple: waiting three days for owner approval on a $150 repair costs more in tenant frustration and potential damage than the repair itself. But that same low threshold should not stretch to cover a $2,800 furnace replacement or a full roof section repair, even if the manager frames it as "urgent." If your contract doesn't spell out a dollar figure, add one this week. Something as specific as furnace filters is a fine example of routine maintenance a manager should just handle, no calls needed.

What decisions need the owner's written sign-off?

Anything over the approval threshold, anything that changes the property's structure, and anything that locks you into a contract longer than 12 months needs your signature, not your manager's judgment call. This includes roof replacement, foundation work, electrical panel upgrades, and any vendor contract with an auto-renewal clause.

Capital decisions like these affect your equity and your tax basis, not just this month's operating budget. A manager who orders a full driveway replacement without asking is making a decision that's yours to make, even if the driveway genuinely needs it. Put a clause in your agreement requiring written estimates and your explicit approval for anything above the threshold, with a 48-hour response window built in so projects don't stall.

Who decides when there's an emergency at 2 a.m.?

The management company should have authority to act immediately on true emergencies, defined narrowly as anything threatening life, safety, or major property damage if it waits until morning. A burst pipe, a gas smell, a fire alarm, or a tenant locked out during a storm all qualify. A dishwasher that stopped draining does not, even if the tenant calls it urgent.

| Situation | Manager Decides Alone | Owner Approval Required | |---|---|---| | Burst pipe flooding a unit | Yes, immediately | No | | Roof leak during a storm | Yes, temporary patch only | Yes, for full repair | | Broken AC in July | Yes, if under cost cap | Yes, if replacement needed | | Tenant lease violation | No | Yes |

Good agreements name specific dollar caps for emergency spending too, often $500 to $1,000 without prior approval, with a requirement to notify the owner within 24 hours after the fact. That protects tenants from unsafe conditions and protects you from a surprise five-figure invoice.

Who has the final say on tenant issues like eviction or lease terms?

The owner should retain final authority over eviction decisions, lease renewals, and rent changes, even though the management company handles the paperwork and legal filings. A manager can and should recommend eviction when a tenant is 60 days past due, but the decision to proceed, especially given the cost and time of a formal eviction, belongs to the person who owns the asset.

The same goes for lease renewal terms. A manager might suggest a 5% rent increase based on local comps, but you decide whether to apply it, delay it, or offer a shorter lease instead. This matters more in states with strict notice requirements, where a mistimed decision can cost you an entire renewal cycle. Screening decisions, however, like which applicant qualifies under your stated criteria, are usually fine to leave with the manager as long as your criteria are documented and consistently applied.

What should be written into the management agreement itself?

The agreement should spell out three things clearly: the dollar threshold for independent approval, the definition of an emergency, and the notification timeline for anything above that threshold. Vague language like "reasonable repairs" or "as needed" is where most disputes start, usually around month eight or nine when a large bill finally shows up.

Ask for monthly statements that separate routine maintenance from capital spending, so you can spot patterns, like a manager who consistently uses "emergency" language to bypass approval. If you're also tracking issues like chimney flashing leaks or drainage problems that tend to escalate slowly rather than overnight, make sure the agreement treats those as owner-approval items even if the manager notices them first.

FAQ

Can a management company sign contracts on my behalf?

Only if your agreement grants that authority explicitly, usually limited to vendor contracts under a set dollar amount, often $1,000 to $2,000. Anything larger, or any contract with a term over 12 months, should require your signature directly.

What happens if a manager makes an unauthorized repair?

Most agreements state the owner isn't obligated to reimburse costs above the approval threshold unless it qualifies as a documented emergency. This is why the emergency definition in your contract needs to be specific, not left to interpretation after the fact.

Should I let the manager choose which contractor to hire?

Yes, for routine work under your approval threshold, since managers usually have vetted vendors who respond faster and charge fair rates. For anything above that threshold, ask for at least two bids before approving.

How often should I review what the management company decided?

Monthly, at minimum, using the itemized statement they provide. A quick 15-minute review each month catches pattern issues, like recurring "emergency" repairs, before they add up to thousands of dollars a year.

Can I change the approval threshold after signing the agreement?

Yes, most management agreements allow amendments with 30 days' written notice to either party. If your current threshold feels too high or too low based on a year of statements, this is a normal adjustment to request.

This is educational information, not legal advice. Consult a real estate attorney before drafting or amending a management agreement, since state landlord-tenant law affects what authority can legally be delegated.