With 2019 Winding Down, It's the Perfect Time to Review Your Lease
With 2019 coming to a close, it’s important to stay on top of your finances before heading into a new year. That’s why it’s the perfect time to complete a full evaluation of your lease, and to inspect the overcharge fees your landlord has charged over the past 12 months. Here’s our tips for completing a comprehensive review of your lease so you can go into 2020 with a clean slate.
Common Expenses, Unexpected Fees
CAM (common area maintenance) expenses, or fees paid by the tenant to help cover the year’s overall operating costs, are generally detailed in your lease. That’s why it’s important to have a full understanding of your financial responsibilities when your lease begins. But by the end of the year, you should undergo a full review of your CAM/pass-through bills, which cover areas like parking lots, lobbies, and other spots in your building that everyone uses. Be sure to confirm what your base year is in your lease, so you can make sure that your final bill is in line with what the average market expected increase predicts. If the increase goes far beyond the typical 2-4%, be sure to flag it so you can bring this up with your landlord.
Stand Up for a True Up
During the first quarter of the new year, request a true up statement from ownership, along with estimated CAM and real estate tax numbers for the next 12 months. While they may not match the ultimate amount you’ll have to spend, it’s extremely helpful to have tools that provide a ballpark estimate of how much you’ll end up spending in the upcoming year.
One Step Ahead
Since the end of the year is the perfect time to complete a full review of your lease, use this time to prepare for any upcoming critical dates that may be on the horizon. Keep your eyes open for statements in your lease that could include termination options, renewal options, and security deposit burndown.
Know the Market
As you review your lease, be sure to flag any options that may become active in the near future. By becoming fully educated on your agreement and the market conditions, you’ll be ready to choose to exercise any of your options if it’s necessary.
While it’s important to stay on top of these things, Cresa’s trained team members serve as a vital resource for helping you understand your expenses and options heading into the new year.