When purchasing an investment property, there are a number of costs you’ll need to keep in mind. For brevity’s sake, we’re going to cover just three of the most significant expenses today:
1. Property management fees. As a landlord, you’ve got enough on your plate. Hiring a property manager will ensure that your investment is well taken care of. However, this necessary service comes at a cost—usually 5% to 12% of the monthly rent.
2. Leasing. This can cost as much as one month’s rent or as little as .25% each month.
3. Maintenance. Typically, landlords should maintain a reserve between $300 and $400 to make sure minor issues can be resolved in a timely manner. Having between 3% to 6% of annual rent in reserve will help you avoid spending out-of-pocket funds on fixing up your property.
If you have any other questions or would like more information, feel free to give us a call or send us an email. We look forward to hearing from you soon.