Certified Apartment Portfolio Supervisor (CAPS) Practice Exam - Module 1

Question: 1 / 400

In terms of operating expenses, what does the management agreement typically outline?

Owner's complete financial responsibility

Limits on typical versus extraordinary expenses

The management agreement typically outlines limits on typical versus extraordinary expenses to ensure clarity in financial responsibilities. This provision helps define what constitutes normal operating expenses that are considered standard for property management, such as maintenance, utilities, and routine repairs, versus extraordinary expenses that may require special consideration or approval, like major renovations or significant repairs.

By delineating these limits, both owners and property managers can align their expectations and avoid disputes over unexpected costs. This structure helps maintain the financial health of the property while ensuring that there is accountability in how funds are utilized. The other options do not accurately capture the primary purpose of the management agreement in this context.

Get further explanation with Examzify DeepDiveBeta

Guaranteed returns on investments

Conditions for tenant evictions

Next Question

Report this question

Download Certified Apartment Portfolio Supervisor (CAPS) Practice Exam - Module 1 PDF Study Guide
Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy