Property Management Blog

Recently, I had the opportunity to evaluate the income and expenses of the single family rental homes that we manage. If any of you are thinking about investing in real estate and want to take advantage of present day purchase prices as well as lower interest rates, here’s what I found out after looking at the past five year’s history:

As you can see, our properties are spending about 22.1% of their income in operating expenses. There are a number of items that are not included in this analysis. Collection costs as well as Professional Services for the owner were less the .2% so I didn’t see a need to add them. Also, because we do not pay the mortgages of our owners, one would have to include their debt service when looking at a complete income and expense analysis. 

A friend of mine did this same type of analysis for the properties that he manages in Boise, ID. He found that his total expenses were running at about 30% of the income collected. That might seem a bit higher then my figures. However, Tony included the apartment communities that he manages as well as his single family homes in his overall analysis. Multi-family communities will tend to have higher turnover rates then single family thus lending themselves to slightly higher operating costs. His figures also did not include debt service.

As far as how Bell-Anderson is doing in the marketplace, here’s a couple of graphs that demonstrate that overall in the past seven months we (green line) are slightly below the surrounding area (yellow line) in our vacancy rates. Also, our rental rates were running above the local and national rates but seem to have tapered off to meet other management firms in the local area, yet are still above the national average for rents. As you can tell, this is a great area of the country to invest in single family home rental property.