As a member of your condominium board, or even as a condo owner there are significant advantages of utilizing a rental pool in your condo building. The only challenge is finding the time, or a reliable company to manage it.
What is a Condominium Rental Pool?
Quite simply, a rental pool is created anytime a group of owners decides to pool (or combine) the rental income from their respective condo units and share the associated costs of all rental condos. Creating a rental pool in your condo building is a decision that should be contemplated carefully. There are both benefits and drawbacks to rental pools that must be discussed before a group decision should be made.
Understanding that the owners will share the profit (or loss) from the condo rental pool, it is not uncommon for rental pools to have their own Board of Directors. However, a professional property management company can also be retained to gather rent, maintain the units, pay unit expenses, and distribute the remaining income to the condo owners.
The main advantage of hiring a professional property management company for your condo is having a single point of contact between owners and renters. But also, there tends to be a greater enforcement of condo rules and regulations.
How do Condominium Rental Pools Work?
They give you the option to amalgamate a group of rentals into one financial portfolio and then split the costs and income into equal portions. It is a condominium investment where you can pool the rental income with other owners and share some or all of the expenses. This type of investment ensures owners a monthly income regardless of turnovers, economic factors, and other variables.
Since all units of the rental pool are in the same place, there are shared sets of accounting records which make it easier to manage, and the savings are passed on to condominium owner. Other returns include administration charges, shared banking fees and the advertising of your property for rent.
However, there are some ancillary expenses which include unit repairs, painting, appliance repair or replacement. The rental pool does not pay property taxes, insurance premiums, or the mortgage. But there are a variety of monthly fixed costs that the rental pool does pay: these include the owners' condominium fees, resident manager pay, and the management contract.
The use and rental of the unit will comply with applicable legislation governing hotel accommodation rentals. And net revenues are to be paid to the owners on a monthly basis.
The property management company representative will be paid a monthly fee for maintenance, management, and administration of the common property for the rental pool owners. Typically, management fees start at 10 percent of collected rent. To ensure proper accounting, the rental pool management company will prepare or have prepared audited annual financial statements. In addition, the property management company representative is required to attend all regular meetings of the strata corporation and the strata council.
Braden Equities Inc. has been successfully managing condominium buildings in Edmonton since the 1970s. We feel that experience makes our condo pool property management team one of the best in Edmonton. This means that you can leave all the daily tasks that come along with being a landlord to us and take more time to focus on the important things in your life. Contact us today.