Time for another Houston apartment update! This report is much nicer than the last one. Occupancy has increased to 93% from 90% in January. This is a very nice improvement over the declining values we were seeing the last couple of months. As occupancy rose, so too did revenue – a $10,000 increase in April over March. Management expects another $5,000 increase in revenue in May. Rent concessions are down about $2,000 from March, but still at a fairly high $20,000 (!). Hopefully, as occupancy increases and the economy improves, this number will continue to decrease. As a comparison, the budgeted amount for concessions is $5,000 per month.
The good news of increasing revenue was counter-balanced somewhat by some not so good news. Our monthly real estate tax escrow amount increased by almost $9,000 per month. This was partially offset by a decrease in insurance escrow of about $6,500 per month. (The new insurance cost is about half of the old cost.) The silver lining is that the property’s assessed value declined by 5.5% in 2010, so the real estate tax escrow next year will go down again.
Expenses increased a bit. The quarterly unit inspections took place and resulted in an increase in the Repairs and Maintenance category. Some capital expenses also took place - one of the central water heaters failed and had to be replaced.
Overall, the property still lost money in April – about $17,000. Hopefully, the property will return to profitability soon!