As a property owner in Houston, Texas, you could be searching for someone to help you manage your property. I will assure you that these services can be offered to you in Houston and offered excellently. All you need to do is link up with a local property management company. Before venturing out, however, it is prudent to seek answers to some questions. For instance, what is capital improvement? How does it work? I can attest that it is efficient but you first need to know what it is all about.
Basically, I may say capital improvement is the value addition to a property. Capital improvements usually have costs or expenses tied to them. These costs are long-term investments that oversee the improvement of any asset that a property owner has. They are geared towards improving the value of these properties. You can get the same analysis from property managers in Houston.
Capital Improvement will be highlighted using some major dimensions. It is only when these dimensions are met, can I confidently say that capital improvement is being done or has been accomplished.
These three important pillars of capital improvement include:
• Value addition- Capital improvement is synonymous with value addition. The property put under capital improvement needs to get better after the restructuring. In real estate, this implies that the life of this property is prolonged.
• Capital improvements are permanent installations. Any capital improvement made should leave a mark: preferably a permanent mark or installation.
• Becomes part of the real property. Any further damage to the property will affect the improvements done through capital installations.
Improvements done in a house could be the installation of a kitchen fireplace, building a deck, painting the house among other upgrades.
A property management company in Houston can help you get improvements done at your rental properties. Whether your property is a residential, single, family unit, or an apartment, this company will come in handy to give you the services you need at an affordable price. The local government of Texas, under the State department of Taxation, has moved with speed and checked to ensure that such firms are compliant with the law. A five-year plan has been updated with an aim of positively addressing the infrastructural needs of the beautiful city of Houston. Money has been set aside to that effect too. Details of these plans are available on their website.
Capital Improvements vs. Maintenance
Let us try to explain to any real estate and property owner in Houston the thin line separating Capital Improvement and Maintenance. Do we have a difference between the two or are they rather intertwined?
1. The difference
Capital maintenance and capital improvement may not be as synonymous as many would assume. Maintenance costs, for instance, are expenses for normal repair activities within real estate premises. They fall under the ‘R&M’ category. Their budget is usually catered for under the operational expenses. Capital improvements are more or less all additional investments that have long-term benefits. Having the aim of adding value to the asset, capital improvements are likely to benefit the whole group that has vested interests in a property as opposed to the maintenance, which is just an expense!
2. Specific criteria or dimensions for each
I will also advise you on the classification of the two important terminologies. Firstly, there is routine maintenance that is done to cement the condition of various entities within the premise. With the routine maintenance, operations will be restored to their normal standards. Secondly, there is preventive maintenance that focuses on preventing further damage on facilities. Those parts that have been adversely affected may be replaced.
Capital improvements, on the other hand, have their specific criteria. The main focus is to accelerate or give a facelift to the condition of an asset. This boost should make the asset better than it was before the facelift. The ‘status quo’ is altered. The state of a stadium, for instance, can be expanded to accommodate 80000 fans up from 50000 fans. This leaves a mark and changes the status quo. A quality improvement, such as adopting electronic services in a hospital or a company replacing manual work that was less effective, is also a form of capital improvement.
3. Maintenance may grow to become a capital improvement!
I bet you didn’t see this one coming! You may be going for a repair under the operational account but end up with a capital improvement. Property managers in Houston can affirm this. An area to be maintained or repaired may be found to require an overhaul. For example, if the plumber finds the pipes he/she was to replace are now rusty, he/she will be compelled to request for a capital improvement. This may come as a surprise because no one anticipated it, not even the plumber! The surprise notwithstanding, new pipes are bought and even the channeling may be changed using a different route to pump the water into the houses.
4. Careful evaluation and categorization
The way an evaluation is done may determine whether there will be a capital maintenance or an improvement. This is an automatic expenditure, whatever side it lies. It should, therefore, be carefully done, with consideration of the original cost, the goal to achieve, and the intended work.
The National Association of Residential Property Managers (NARPM) may also come in handy to curtail difficulties that residential owners go through to maintain their homes. They made it possible to access the support that could not be found when there was no unity.
I urge you to move with speed and contact a property management company in Houston property management and take the pain of managing the property you have off your back. Whether you are in need of a capital improvement or maintenance, you can be sure that the experts will sort you out.