Property Management Licensing Requirements In Connecticut

Third-party property management in Connecticut is regulated activity: before a company can lease units, collect rent, or manage properties on behalf of an owner for compensation, it needs to understand exactly who must hold a license, what that license requires, and how client money has to be handled once the business is operating. This guide covers both, with the statute or agency rule behind each requirement.

Who Needs A License To Manage Property

Third-party property management in Connecticut generally requires a real estate broker license issued by the Department of Consumer Protection under the Real Estate Licensees chapter of the General Statutes. Connecticut restructured parts of its broker licensing law effective April 1, 2024.

• No person may act as a real estate broker or salesperson, which includes leasing or renting real estate or negotiating leases for others for compensation, without a license issued by the Department of Consumer Protection, unless an exemption applies. (Conn. Gen. Stat. § 20-311, § 20-312)
• Connecticut's real estate broker licensing chapter (Chapter 392) was substantially amended by Public Act 23-84, with several sections, including the prior version of the general license-required section, repealed and replaced effective April 1, 2024. (Public Act 23-84 (2023))

Client Trust Account Requirements

Connecticut law requires brokers who hold money belonging to others, including rent and security deposits collected while managing property, to keep those funds in a dedicated escrow or trust account separate from the broker's own funds, deposited promptly, free of commingling, and subject to Real Estate Commission audit.

• Each licensed broker who receives and holds money on behalf of a principal, client, or other person must maintain a separate escrow or trust account, distinct from the broker's own account, at a bank doing business in Connecticut. (Conn. Gen. Stat. § 20-324k)
• Brokers must deposit such money into the escrow or trust account within three banking days of the date the agreement is signed by all necessary parties, and hold it pending final legal disposition. (Conn. Gen. Stat. § 20-324k)
• Commingling funds of others with the licensee's own funds, or failing to keep others' funds in an escrow or trust account, is a prohibited act that can result in license suspension or revocation. (Conn. Gen. Stat. § 20-324k)
• The Connecticut Real Estate Commission may examine and audit any broker's escrow or trust account whenever it deems necessary, and brokers must retain related escrow records for at least seven years. (Conn. Gen. Stat. § 20-324k)

Holding a license is the entry requirement; keeping client trust accounts clean is what actually determines whether a Connecticut management company stays in business. A trust shortage is a licensing problem, not just a bookkeeping one, so the habits that keep a company compliant are the same ones that keep it audit-ready: deposit on time, never mix operating and client money, and reconcile every account every month. Our guide to preparing for a trust account audit walks through what examiners actually ask for.

Staying Licensed And Compliant

Requirements change over time, education hours get updated, and license periods renew on a fixed schedule, so this is worth a periodic check against the current rule rather than a one-time read. This guide is a starting point for professional managers, not legal advice. For a specific licensing question, confirm the current requirements directly with the Connecticut Department of Consumer Protection, Real Estate Commission.

Sources

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

• Conn. Gen. Stat. § 20-311, § 20-312, Connecticut General Assembly, Connecticut General Statutes, Chapter 392
• Public Act 23-84 (2023), Connecticut General Assembly, Public Act 23-84