Certified Apartment Portfolio Supervisor (CAPS) Practice Exam - Module 2

Which factor is not typically included in lease-up budgets?

1. Starting operational expenses

2. Tax forecasts

3. Extensive marketing efforts

4. Initial staffing costs

The correct answer is: Tax forecasts

The factor that is not typically included in lease-up budgets is tax forecasts. Lease-up budgeting primarily focuses on the immediate costs associated with achieving stabilized occupancy in a new property. This includes starting operational expenses, initial staffing costs, and extensive marketing efforts to attract tenants and fill units quickly. Tax forecasts, while important for overall financial planning and analysis, generally pertain to future obligations that are not necessary for calculating the initial costs and revenue projections during the lease-up phase. Therefore, they are usually not considered part of the lease-up budget, which instead zeroes in on direct costs and strategies aimed at successfully launching the property and generating initial rental income. This focus ensures that management can allocate resources effectively to drive occupancy levels during the critical lease-up period.