Maintenance reserve

A maintenance reserve is a small balance the manager keeps in the owner's account. It lets the manager pay for routine repairs right away, such as a leaking faucet or a broken lock, without waiting for the owner to reply. Quick repairs protect the home and keep tenants happy.

Most managers set a spending limit. Repairs under the limit are paid from the reserve, and the owner is told. Bigger jobs need an estimate and the owner's approval first. The reserve also stays in your account. It is your money, not a fee, and you should see it on your statements. Ask what amount is held and when it is topped up from rent before an owner draw.

Real Property Management Gold holds a maintenance reserve and asks owners to approve repairs above the reserve amount. The reserve also keeps cash flow planning honest, because repairs are a normal cost of owning a rental.