Investor · Raleigh, NC · Member since 2014 · 55 posts · 5 votes
Hi guys,
What's the % of monthly rent you would estimate for renovated property? The property is 100 years old but has been renovated. It's a 4 unit. 1 bedroom/1 bath per unit.
I know the numbers can vary but just want a good idea here of what to budget for maintenance/expenses. I would be using a property management firm to manage the property.
Each company is different, but most companies ask the owner to have a maintenance limit, $0, $250, or $500. Any repair above the limit requires the management firm to contact the owner before doing repairs. In emergency, situations a firm will protect the property and make the necessary repairs without your consent.
On a 100 year old building I think you can count more than 5% for repairs, depending on what renovation was done. And understand that if you have to replace a furnace, strictly speaking this is not a "repair". It's a capital expenditure. Without looking I think my repairs (not capital expenditures) are running more like 10%. On an older building with property management you're probably going to be looking at 50-55% of your rent for everything except your mortgage payment.
50%? Wow. Let me add some more information that may change your figure. The 4-unit bldg has 4 newer heating systems (natural gas). There's no Central Air -- the tenants provide their own window a/c units. The appliances are new, as well.
You would still say 50%? Also, would having a home warranty cut some of these expenses down, as well?