Property Management Laws And Regulations In Maryland

Maryland regulates third-party property management through several authorities at once, and the rules that matter most to a management company are the ones covering your license, your client trust accounts, and the money you hold on behalf of owners and tenants. This guide covers those rules for professional managers, with the statute or agency regulation behind each one.

Everything below is sourced to Maryland's own statutes, agency rules, and court materials rather than to secondhand summaries. Specific dollar amounts and deadlines do change; the citations do not, so you can always open the authority and confirm the current text before you act on it.

Licensing Requirements For Property Managers

Maryland requires a real estate broker license to provide compensated leasing or rent-collection services for another party, which covers third-party property management companies. A narrow exemption applies only to an agent or regular employee of a licensed broker or of the property owner who manages or leases that specific real estate on the owner's or broker's behalf, not to independent management companies acting without a broker relationship.

• Providing 'real estate brokerage services' in Maryland, defined to include leasing real estate or collecting rent for another for compensation, requires licensure by the Maryland Real Estate Commission. (Md. Code Ann., Bus. Occ. & Prof. § 17-101, § 17-301)
• An individual must be licensed as a real estate broker, associate broker, or salesperson before providing real estate brokerage services in the state; salespersons and associate brokers must act on behalf of a licensed broker. (Md. Code Ann., Bus. Occ. & Prof. § 17-301)
• A statutory exemption from the license requirement applies to an agent or regular employee of a licensed real estate broker or of a property owner while that person manages or leases real estate on behalf of that specific broker or owner. (Md. Code Ann., Bus. Occ. & Prof. § 17-301 (exemptions))
• The Maryland Real Estate Commission, within the Division of Occupational and Professional Licensing, administers original license applications, broker license upgrades, and continuing education for real estate licensees. (COMAR 09.11)

Client Trust Account Rules

Maryland brokers who hold client trust money, including rents and deposits collected for owners, must deposit it promptly into a segregated trust or escrow account kept entirely separate from the broker's own funds, and may never commingle or misuse it. The broker bears personal responsibility for the account, must be a signatory on it, and must keep detailed records available for Commission inspection.

• A real estate broker must deposit trust money (money entrusted to the broker for a real estate transaction) no more than 7 business days after acceptance of a contract, into an account maintained separately from the broker's own accounts and used solely for trust money. (Md. Code Ann., Bus. Occ. & Prof. § 17-502(a)-(b))
• A broker may not use trust money for any purpose other than the purpose for which it was entrusted, and an associate broker or salesperson who obtains trust money must promptly submit it to the broker on whose behalf they provided services. (Md. Code Ann., Bus. Occ. & Prof. § 17-502(b)-(c))
• A broker must maintain a non-interest-bearing escrow or special account and report the bank name and account number to the Commission as soon as trust monies are received; establishing an individual interest-bearing account under § 17-505 need not be reported as long as records are kept available for Commission inspection. (COMAR 09.11.01.07; Md. Code Ann., Bus. Occ. & Prof. § 17-505)
• The broker must be a signator, or designate a licensed alternate signator, on checks drawn on escrow accounts the broker is required to maintain; a nonlicensed person may only be a co-signator alongside a designated licensee. (COMAR 09.11.01.17)

Trust account rules are where Maryland management companies get into trouble fastest, because a shortage is a licensing problem and not just a bookkeeping problem. The habits that keep you clean are the boring ones: deposit on time, never let operating money and client money mix, reconcile every account every month, and keep a per, property record you could hand to an auditor without preparing it first. Our guide to preparing for a trust account audit walks through what examiners actually ask for.

Security Deposit Rules

For leases entered on or after October 1, 2024, Maryland caps most security deposits at one month's rent, with a narrow exception up to two months for tenants receiving utility assistance. Deposits must be held in a Maryland financial institution, earn statutory interest after six months, and be returned with an itemized accounting within 45 days of move-out, or the landlord risks treble damages.

• For most residential leases entered on or after October 1, 2024, a landlord may not charge a security deposit exceeding one month's rent; a higher deposit of up to two months' rent is permitted only where the tenant qualifies for utility assistance through the Department of Human Services, the lease requires the tenant to pay utilities directly, and both parties agree in writing. (Md. Code Ann., Real Prop. § 8-203(a))
• Security deposits of $50 or more held at least 6 months must accrue simple interest at the greater of the U.S. Treasury yield curve rate (as of the first business day of the year) or 1.5% per year, accruing monthly. (Md. Code Ann., Real Prop. § 8-203)
• Landlords must deposit security deposit funds in a federally insured financial institution located in Maryland within 30 days of receipt, devoted exclusively to security deposits (or in insured certificates of deposit or government securities). (Md. Code Ann., Real Prop. § 8-203)
• Within 45 days after the tenancy ends, the landlord must return the deposit with accrued interest, minus lawful deductions; if withholding any amount, the landlord must provide a written list of damages claimed and an itemized statement of costs incurred within that same 45-day window. (Md. Code Ann., Real Prop. § 8-203)
• A landlord who fails to comply with the security deposit statute's requirements, or who withholds a deposit in bad faith, may be liable to the tenant for treble damages plus reasonable attorney's fees. (Md. Code Ann., Real Prop. § 8-203)

Lease Agreements And Required Disclosures

Maryland requires landlords to attach a current copy of the state's Tenants' Bill of Rights to every residential lease and voids a list of tenant-unfavorable lease clauses outright. Certain disclosures, such as security deposit receipts, are also mandatory lease components.

• Maryland law requires the Office of Tenant and Landlord Affairs to publish a Tenants' Bill of Rights and update it by June 1 each year; landlords have been required to attach the current version to every residential lease since July 1, 2025. (Md. Code Ann., Real Prop. § 8-208 (as amended by 2024 Renters' Rights and Stabilization Act, HB 693))
• A residential lease may not include a confessed-judgment clause, a jury-trial waiver, a provision restricting a tenant's ability to contact police or emergency services, upfront payment demands exceeding the security deposit plus first month's rent, or an unacknowledged automatic-renewal term; such provisions are unenforceable. (Md. Code Ann., Real Prop. § 8-208(d))
• Landlords must include in the lease a security deposit receipt and a statement addressing habitability and safety conditions, along with clear assignment of utility and repair responsibilities. (Md. Code Ann., Real Prop. § 8-203.1, § 8-208)

Entry Notice And Tenant Privacy

Effective October 1, 2025, Maryland cut the required advance notice for landlord entry from 48 to 24 hours and added specificity requirements for that notice, while preserving an exception for genuine emergencies.

• Effective October 1, 2025, under HB 1076 (2025), a Maryland landlord must give a tenant at least 24 hours' written notice, stating the date, approximate time, and specific reason, before entering a rented dwelling unit for non-emergency purposes such as repairs, inspections, or showings. (2025 Md. Laws, Ch. 564 (HB 1076))
• A landlord may enter without prior notice only for a genuine emergency, such as fire, flooding, a gas leak, or another urgent safety hazard. (2025 Md. Laws, Ch. 564 (HB 1076))

Rent, Late Fees, And Other Charges

Maryland has no statewide rent control statute. State law caps the late fee a lease may impose, though it does not itself mandate a grace period before that fee can be charged.

• A residential lease may not impose a late-payment penalty exceeding 5% of the unpaid rent due for the delinquent rental period; for rent paid in weekly installments, the cap is instead $3 per late weekly payment, up to $12 per tenant per month. (Md. Code Ann., Real Prop. § 8-208(d)(3))

Fee income is also taxable income, and how you record management fees, late fees, and pass, through charges affects both your compliance position and your books. See our guide to Maryland property management taxes for the reporting side.

Fair Housing Obligations

The Maryland Commission on Civil Rights enforces the state's fair housing law, which extends protection well beyond the federal Fair Housing Act's classes, notably to source of income, an area MCCR has actively investigated against property managers.

• Maryland's fair housing law protects against discrimination based on race, color, religion, sex, familial status, national origin, marital status, sexual orientation, gender identity, disability, source of income, or military status, enforced by the Maryland Commission on Civil Rights. (Md. Code Ann., State Gov't § 20-701 et seq.)
• Source of income is defined broadly to include any lawful, verifiable source of money paid to a renter, including housing vouchers and rental assistance, pensions, alimony, child support, and investment income; it is unlawful to impose different rental terms because a tenant uses such income. (Md. Code Ann., State Gov't § 20-701)
• MCCR has pursued discrimination settlements against residential property managers and owners for imposing higher rent increases on tenants using housing vouchers, in violation of the source-of-income protection. (Md. Code Ann., State Gov't § 20-701 et seq.)

Habitability And Safety Duties

Maryland law implies a warranty of habitability in every residential lease and gives tenants a rent-escrow remedy for serious, un-repaired defects, backed by a retaliatory-eviction presumption that protects tenants who exercise these rights.

• Every Maryland residential lease carries an implied warranty that the dwelling is fit for human habitation, meaning free from serious defects or conditions that constitute a fire hazard or other serious and substantial threat to occupants' life, health, or safety. (Md. Code Ann., Real Prop. § 8-212)
• A tenant may petition the District Court for a rent-escrow order when a landlord, after written notice, fails within a reasonable time (more than 30 days is presumed unreasonable) to repair a condition posing a substantial and serious threat to life, health, or safety, such as lack of heat, water, or a structural defect. (Md. Code Ann., Real Prop. § 8-211)
• Courts may award rent abatement, lease termination, or escrow-fund disbursement for repairs under the habitability and rent-escrow statutes, and a prevailing tenant may recover attorney's fees and litigation costs. (Md. Code Ann., Real Prop. § 8-211, § 8-212)
• If a landlord takes adverse action, such as eviction, a rent increase, or a service reduction, within 6 months of a tenant reporting a code violation, joining a tenant organization, or calling emergency services, the action is presumed retaliatory, exposing the landlord to damages up to 3 months' rent plus attorney's fees. (Md. Code Ann., Real Prop. § 8-208.1)

Eviction Basics

For nonpayment, a Maryland landlord must send written notice and give the tenant 10 days to pay before filing in District Court; the case moves quickly, and the tenant generally retains a right to redeem the tenancy by paying what is owed before the eviction is executed. Self-help evictions are illegal.

• Before filing a failure-to-pay-rent case, a Maryland landlord must give the tenant written notice of intent to file and 10 days to pay; the complaint is then filed in the District Court of the county where the property is located. (Md. Code Ann., Real Prop. § 8-401)
• The District Court summons the tenant to respond within 5 days; if the court finds rent due and unpaid and enters judgment for the landlord, possession transfers within 4 days, subject to a tenant's right to redeem by tendering all rent, costs, and fees before execution, unless the tenant has received three prior possession judgments within 12 months. (Md. Code Ann., Real Prop. § 8-401)
• Either party may appeal a District Court eviction judgment within 4 days to the circuit court; a warrant of restitution executes 7 days after judgment if the tenant does not comply. (Md. Code Ann., Real Prop. § 8-401)

Recent Changes Worth Tracking

These are the Maryland changes most likely to affect a management company's procedures. Confirm the effective date against the source below before you update a lease template or a policy.

• Effective October 1, 2024: The Renters' Rights and Stabilization Act lowered the standard security deposit cap from 2 months' rent to 1 month's rent, with a narrow exception up to 2 months for tenants receiving utility assistance. (2024 Md. Laws, HB 693)
• Effective July 1, 2025: Landlords became required to attach the current statewide Tenants' Bill of Rights to every residential lease. (Md. Code Ann., Real Prop. § 8-208 (as amended by 2024 HB 693))
• Effective October 1, 2025: The required advance notice for non-emergency landlord entry into a rented dwelling was reduced from 48 hours to 24 hours, with new specificity requirements for the notice. (2025 Md. Laws, Ch. 564 (HB 1076))

Staying Compliant Without Guessing

Most Maryland compliance failures are not decisions, they are drift: a deposit that sat too long, a reconciliation that got skipped in a busy month, a lease template that never got updated after a statute changed. Build the calendar first. Monthly trust reconciliations, an annual review of your lease and disclosure packet against current statutes, and a documented process for deposits and refunds cover the large majority of what an examiner will ask about.

This guide is a starting point for professional managers, not legal advice. For a specific dispute, a novel fact pattern, or anything with real money at stake, work with a Maryland attorney, and confirm the current text of any statute cited above with the Maryland Real Estate Commission (MREC) or the Maryland legislature.

Sources

Every fact above is drawn from one of the official sources below.

• Md. Code Ann., Bus. Occ. & Prof. § 17-101, § 17-301, Maryland General Assembly (mgaleg.maryland.gov)
• COMAR 09.11, Maryland Department of Labor, Maryland Real Estate Commission
• Md. Code Ann., Bus. Occ. & Prof. § 17-502(a)-(b), Maryland General Assembly (mgaleg.maryland.gov)
• COMAR 09.11.01.07; Md. Code Ann., Bus. Occ. & Prof. § 17-505, Library of Maryland Regulations (COMAR)
• Md. Code Ann., Real Prop. § 8-203(a), Maryland General Assembly (mgaleg.maryland.gov)
• Md. Code Ann., Real Prop. § 8-208 (as amended by 2024 Renters' Rights and Stabilization Act, HB 693), Maryland.gov official news release, Dept. of Housing and Community Development
• Md. Code Ann., Real Prop. § 8-208(d), Maryland General Assembly (mgaleg.maryland.gov)
• 2025 Md. Laws, Ch. 564 (HB 1076), Maryland General Assembly, 2025 Regular Session Chapter Law
• 2025 Md. Laws, Ch. 564 (HB 1076), Maryland General Assembly, HB 1076 (2025 Regular Session)
• Md. Code Ann., State Gov't § 20-701 et seq., Maryland Commission on Civil Rights
• Md. Code Ann., State Gov't § 20-701, Maryland Commission on Civil Rights, Source of Income Guidance
• Md. Code Ann., State Gov't § 20-701 et seq. (source-of-income enforcement), Maryland Commission on Civil Rights
• Md. Code Ann., Real Prop. § 8-212, Maryland General Assembly (mgaleg.maryland.gov)
• Md. Code Ann., Real Prop. § 8-211, Maryland General Assembly (mgaleg.maryland.gov)
• Md. Code Ann., Real Prop. § 8-208.1, Maryland General Assembly (mgaleg.maryland.gov)
• Md. Code Ann., Real Prop. § 8-401, Maryland General Assembly (mgaleg.maryland.gov)
• 2024 Md. Laws, HB 693, Maryland Department of Housing and Community Development