The quality of management can detrimentally affect operational costs, the quality of life for the residents and values of their homes. The purchase of a home represents the largest investment most people will ever make during their lives. Protecting and enhancing the property values of these homes is one of the primary purposes of a community association and a main value point within Cedar Management Group’s overall service offerings. The determination of property values, however, is not an exact science. Property values are often determined by the marketability of the home and its surrounding community. Communities gain reputations based upon their overall aesthetic and other factors. Well managed communities are valued by their residents for providing vital and efficient services. Their residents enjoy where they live. As a result, these communities often achieve greater appreciation in property values than others. And the reason can usually be attributed to good management.
What value does good management have? And conversely the cost of poor management? Let’s create an example: If a community has 100 homes, and each home has an average market value of $250,000, then the total collective property value of the community would be $25 million (100 homes x $250,000). If the property values within that community rose 3% instead of 2% per year as a result of being well managed and maintained, then the collective incremental increase in property values achieved through good management would equate to an astounding $250,000 ($25 million x 1%). The value of good management in this example would result in an additional $250,000 for the community or $2,500 per home per year. Conversely, if the community was not maintained or managed as well, the collective cost of poor management would equate to the same $250,000.
Ironically, some communities consciously choose to reduce the quality of their services, diminish the appearance of their buildings or grounds, or select a cheaper management company in the belief that they will save a few dollars. Unfortunately, a savings of five or even ten thousand dollars in services or management fees, in this example, would have instead resulted in the loss of $250,000. In addition to the day-to-day care that Cedar Management Group provides to each community we manage, we also look at the big picture.
We create our services and educate and certify our professionals not only to serve our residences with high value service, but also to protect the value of the homes within the community associations we oversee.