Investing in property means repairing and maintaining that property, and no matter how big or small the unit, that means setting aside money from your monthly income to handle repairs and maintenance. While this may be the last thing you want to do, especially if you’re trying to use the money to purchase more investment property in the Kirkland area, it is important for long term security, property valuation, and setting a standard that keeps your units rented out so that you can continue to make money.
If you have a Kirkland property management company handling these details, then you won’t have to worry about it, however, here is some advice on how to calculate setting aside money for maintenance and repairs.
Calculating Money for Maintenance
Regular maintenance means setting aside regular funds for hiring maintenance workers, paying for preventive repairs, and paying for upkeep such as gardening, cleaning, and replacing roofing. Unfortunately, you do have to call experts for estimates, and then plan for the worst. Use the highest quotes, the worst scenarios, and plan for spending that much money per year on maintenance. If you go under, you’ve saved funds that you can use for future investments, if not, you won’t be left short when you spend more than you saved.
Calculating Money for Repairs
Repairs are emergency fixes that are not planned and can vary in size from a $3 pipe seal replacement to replacing your entire HVAC system. For this reason, it is important to set aside enough funds to handle a variety of emergency responses and repairs in all of your units. Kirkland property management recommends setting aside a minimum of 2% of the value of your property each year for repairs, which also doubles as allowing you to save the funds for future investment if you do not use them.
What About Insurance?
Insurance premiums are a must, especially in Kirkland where you have to worry about floods, earthquakes, and other hazards such as storms and fire. Calculating your insurance premium into your monthly maintenance costs helps you to allocate the funds properly, go in prepared for the costs, and know where your funds are going.
Hiring Kirkland Property Management Company
If you choose to hire a Kirkland Property Management company, you can usually save money on maintenance and repairs, but will have to pay a percentage to the property management company. This is a trade off in value, as you are investing less time, but not making as much money, although usually you get a decent trade off in terms of money spent on hiring repairmen and various companies such as real estate lawyers and accountants, because a good property management company handles all or most of this. Consider asking for a direct quote per month and then factoring that into your percentage. This usually allows you to cut other calculations, but make sure that the quote includes maintenance and repair before you do this.
Hiring a Kirkland property management company allows you to save money on hiring maintenance and repair but also saves you time, because you won’t have to handle any of the details yourself. Contact us, or ask for a quote for more information.
The discussion herein is of a general nature only and is not to be construed as specific legal advice, which requires the establishment of an attorney-client relationship and fee agreement. SJA Property Management does not provide legal services.