Nobody wants to pour out all their income on repairs and maintenance. With a clear budget, you’ll be able to set aside the right amount of money for expenses (and avoid getting nasty surprises when repairs are needed)
Every property is unique. That is not just about the differences in the wall colour or floor plans. Instead, we’re talking about the property type and the kind of maintenance each requires.
For Example – Owners of older family homes will need to budget for landscaping, roof repairs, and potentially hiring an electrician to rewire old and unsafe electrical wirings.
On the flip side, apartment owners will need to focus on value-adding maintenance, such as upkeep of air con units and proactively checking smoke and fire detectors.
But every property will have its own repairs and maintenance issues,
Want to avoid overspending on Maintenance?
Quick read: Here are some ways your maintenance expense will not become a bottleneck
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Using the 30% rule:
This is a great method to use if you’re a first-time landlord or want an easy-to-calculate formula you can use for every property in your portfolio.
Essentially, it means you should only spend 30% of your monthly income on operating expenses. Out of which 30% of your total operating expenses should go to your repairs and maintenance bill.
(For e.g if you have an income of Rs. 100,000/-, your operating expenses have to be Rs. 30,000/-, out of which your repairs and maintenance cost should be Rs. 9,000/- at maximum) -
Using the 5% rule:
Another great formula if you’re not a fan of complex calculations is the 5% rule. This means your maintenance cost shouldn’t take up more than 5% of your property’s value per year.
(For e.g if your property’s annual value is Rs.500,000 then your maintenance cost should be less than Rs.25,000)
Remember, these are just ballpark figures to help you estimate the cost of maintenance. But they’ll help you keep track of your repairs and maintenance budget and help you avoid running into cash overflow problems too.
By taking a tailored approach to this problem, you’ll ensure you make cost-effective repairs that will be meaningful difference your expenditure budgets.
Sounds like too much work? You can always reach out to QuickHelp for the best cost-effective maintenance service. Simple reach us on 0766631070 or email us at junaid@quickhelp.lk
