Common Area maintenance Real Estate, or CAM Real Estate for Short, refers to the net costs billed to tenants by the property owner of a residential rental property and is paid by tenants to the property owner in return for an annual performance bond. CAM is a term for standard area maintenance, which involves all of the maintenance requirements a tenant’s common areas will face, such as roof repair, landscaping, electrical wiring, pool maintenance, etc. Generally, these areas are the only parts of the property that will be maintained by the property owner, who will pay for all of the labor costs associated with the job, and then hold the bond to assure the tenant the job has been completed. In some cases, CAM may include all of the roofing work on the property, while in other cases, it may only cover a portion of the work. Regardless, all of the work must be done in good repair and up to current code.
When a property owner holds the CAM bond, they generally set the standard that the entire common area must be periodically inspected, cleaned, repaired, and maintained, including any infestation. As landlords, the most significant advantage to holding the CAM bond is the cost savings. If the property owner doesn’t need to make repairs in several areas, they don’t have to carry a common bond in most cases, thus saving them money to keep a bond. Even if they need to make some repairs, it will help their bottom line since they will only have to hold one common bond instead of several. Most buyers prefer properties that only need regular CAM maintenance instead of major overhauls.
There is much to consider beyond price, location, and amenities when buying a home or apartment. One crucial factor to keep in mind is whether the real estate manager or agent you choose is a Certified Management Property Owner (CMPO). While this distinction isn’t often mentioned when renting an apartment or home, it is imperative in CAM realty bonds. A CMPO has gone through rigorous education and training to earn their certification, making them the most qualified to manage properties. These firms can provide CMPO certified management companies as rental agents, allowing the property owners to save even more money.
An excellent way to save even more money on your CAM real estate investment is by allowing the CAM company to handle the common area maintenance. This saves the agent from having to hold the lease, meaning less work for him or her. The money saved from the lower rate of maintenance fees can be used towards paying down the principal.
