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industry. That 10 cents per $1 of rent helps the industry thrive, which in turn keeps investors and retirement planners happy.
PAYROLL: 10 CENTS OF EVERY $1 OF RENT
Property managers may charge owners 8–12% for their services. This fee covers payroll expenses (totaling over 17.5 million jobs in the industry).
CAPITAL EXPENDITURES: 12 CENTS OF EVERY $1 OF RENT
Renters like having a well-maintained building, but they don’t always realize that 12% of their rent is going toward capital expenditures. These projects ensure the property is not only maintained, but updated regularly.
Related article: Check out How To Write A Rent Increase Notice, and don’t miss the sample letter at the end.
PROPERTY TAXES: 14 CENTS OF EVERY $1 OF RENT
Property taxes take up a big chunk of rent. Owners and homeowners are well aware of how much they pay in property taxes, but renters don’t always think about them as being part of their rent. These taxes support schools, first responders, construction projects and other community needs. They can be a
lot of money, but we’re certain landlords wished more renters knew how important they are.
OPERATING EXPENSES: 16 CENTS OF EVERY $1 OF RENT
It takes a lot to keep a property running. Property insurance, utilities, maintenance, etc. all factor into the operating expenses of a property. One of the perks of renting is that the resident isn’t responsible for property upkeep. The tradeoff is that they have to share the cost of that convenience with other renters.
MORTGAGES: 38 CENTS OF EVERY $1 OF RENT
The mortgage is often the biggest expense a property owner faces. It’s also the most important. If a property is foreclosed on, the entire community could lose their housing. If more renters thought about their living situation this way, they might be more understanding of the costs and challenges their landlords face.
Can’t we all just get along?
With good communication, many renter concerns can be resolved quickly or avoided altogether. So, if they want to know where their money is going, use the information in this article to help them see the big picture.
Yardi Breeze is property management software designed for you. Our refreshingly simple platform puts you in charge of marketing and managing your entire portfolio, with support for residential, commercial, affordable, self storage, HOA/condo and manufactured properties. Rest easy knowing your reports are accurate with Yardi’s trusted, built-in accounting system to track your revenue and expenses. And since Breeze is in the cloud, you can work from anywhere and get fantastic support when you need it.
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AMM3 APARTMENT MANAGEMENT MAGAZINE - NOVEMBER 2021 89