RCRE - Operating Expenses 101

Dylan and Mike discuss operating expenses and the future risks of each Key Information: Management Fee= % of Income the property management in. Verify if other fees are included Repairs & Maintenance are recurring maintenance such as turn costs, touchup costs,  etc R&M should be increasing at the rate as the Consumer Price Index (CPI) due to material costs General & Admin (G&A) includes office expenses, computers, technology, golf carts G&A will increase due to your management’s view on technology moving forward Contract Services include trash, landscaping, pest control, and other services Contract services will increase due to increasing wages  Marketing Costs have shifted from being physical ads to technology Payroll includes salary, benefits, turnover costs, and continuing education Payroll will continue to increase because labor markets are continuing to be more competitive Utilities include water, electric, and gas for office, common areas, and vacant units Natural resources continue to increase in prices and you have to build a buffer just in case  Property Tax increase on the front end when you purchase a property due to the assessed value is increasing to the market Property tax can also increase due to mill rates increasing Insurance has been increasing substantially from last year due to more claims being created Expert Pro Tip: Befriend property management companies   Contact Information: www.randpartners.com  [email protected] [email protected]   For more information/to connect with Rand CRE: www.randcre.com   To register to invest with us: https://invest.randpartnersllc.com/invexp/accounts/login/     Rand CRE's Facebook: https://www.facebook.com/randcre Rand CRE's Twitter: https://twitter.com/randcre Rand CRE's Linkedin: https://www.linkedin.com/company/randcre Rand CRE's Instagram: https://www.instagram.com/randcre We're here to help create real estate entrepreneurs...  About Jake & Gino: Jake & Gino are multifamily investors, operators, and owners who have created a vertically integrated real estate company. They control over $350M in assets under management. Connect with Jake & Gino here --> https://jakeandgino.com. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.