Security Deposit Analysis
Oakwood Apartments • 312 Units
Sample Report
Security Deposit Options
Risk Profile: ELEVATED
Note: Risk profile uses Overall Recovery Rate (damages + bad debt recoveries vs total costs), which differs from Damage Recovery Rate shown below.
Your property has significant turnover and bad debt exposure ($2,516 per moveout vs $1,412 avg rent). Your team recovers 25% through collections, indicating collection challenges. Proper security deposits would provide that capital immediately, eliminating the time, effort, and cost of the collections process.
- Turnover and bad debt costs are 178% of average rent
- Low recovery rate (25%) indicates collection challenges
Approved Applicants
$600
40% of rent
For applicants who pass standard screening criteria. This deposit level provides protection while remaining competitive in the market.
Conditional Approval
$1,800
130% of rent
For applicants approved with conditions due to credit, rental history, or employment concerns. Higher deposit reflects increased risk profile.
Security deposits are calculated as a percentage of average monthly rent to ensure consistent coverage across all unit types. Approved applicants pass standard screening criteria, while conditional approvals require higher deposits due to credit, rental history, or employment concerns.
Your Improvement Opportunity
With a More Appropriate Security Deposit
+$17,216
in recoverable costs annually
Recovery Potential
12%
of current losses
Asset Value Gain
+$344,320
at 5% cap rate
By adjusting your security deposit to the recommended levels and improving collection practices to industry benchmarks (30% damage recovery, <0.5% bad debt), you can recover $17,216/year from your current annual loss of $147,950.
Cost per Move-out
$1,999
Net Turnover + Bad Debt
Damage Recovery Rate
24.5%
Damages recovered vs turnover costs
Target: >30%
Bad Debt
0.72%
Target: <0.5%
Performance Summary
- Bad debt at 0.72% of revenue is well-controlled and below the 1.0% industry threshold.
- Detailed turnover cost tracking across 5 categories enables targeted cost reduction.
- Damage recovery rate of 24.4% is below the 30% benchmark, leaving $8,676 annually unrecovered.
- Paint and flooring represent 63% of turnover costs - consider amortization schedules for resident billing.
Supporting Data
Turnover Cost Composition
Turnover Cost Trends
Turnover Costs
| Category | Annual | Per Turn |
|---|---|---|
| Paint | $52,140 | $704 |
| Cleaning | $31,284 | $423 |
| Flooring | $46,926 | $634 |
| Resurfacing | $15,642 | $211 |
| Other | $10,428 | $141 |
| Gross Total | $156,420 | $2,114 |
| Less: Damages Recovered | ($38,250) | ($517) |
| Net Turnover | $118,170 | $1,597 |
Bad Debt
| Category | Annual | Per Turn |
|---|---|---|
| Rent | $24,240 | $328 |
| Utilities | $3,570 | $48 |
| Other | $1,970 | $27 |
| Gross Write-offs | $34,900 | $472 |
| Less: Recoveries | ($5,120) | ($69) |
| Net Bad Debt | $29,780 | $402 |
Bad Debt as % of Revenue: 0.72%
Sample Report