Once you have rented out the apartment, all that remains is to pay the regular expenses on the property. Generally, these consist of the following:
Local taxes
In the US, the landlord pays local property taxes, unlike in Israel where this is the tenants’ responsibility. Even if the apartment is not rented, this tax must still be paid. It is payable to the local authority every three months and is based on an appraisal of the value of the property in accordance with each region’s taxation method.
Homeowner’s insurance
Premiums for this insurance are paid monthly or annually. The cost is dependent on what is covered by the policy and the value of the property etc. and should be expected to range between $40-70 per month.
Management fee
This fee is paid to the management company from the rent that you receive from your tenants. This is, on average, 8-10% of the rent.
Rental income tax
This tax is paid to the federal government on rental income, in addition to state taxes, as described in previous blog posts.
