WHEN did Management companies start charging residents a fee for PROPERTY TAXES?

For reference, I am in Colorado. I am helping a friend and just viewing his ledger and I noticed one of his reoccurring fees were "Property Tax" and then decided to do a bit of market research and then saw a Greystar Property that is also charging their residents a property tax fee?! How is this legally justified?

I am really glad that HB25-1090 is coming soon, granted those will be included in the pricing, but still so ridiculous.

But yeah, the fees they charged my friend: Common Area Electric, Common Area Gas, Common Area MAINTENANCE? And then again on his Property Tax?

But yeah, if someone could explain that to me, that would be great.
 

So when a property is purchased from a lender the same items are taken under advisement to set the performa rents. Being transparent does not change the math of how rental rates are set at the time of purchase.
An investment group does not just walk out of a property closing saying I am going to set my new rents at $$$$$$. The market, the loan, the cost for operation are all part of that set performa which is the base for the owner.
Just because you did not know the math that made up the rent doesn’t mean it was not there.
Do you transparency is going to change the math? Why would an owner buy a property and not be allowed to pass on the cost?
As for the RealPage lawsuit it was not about transparency it was that they allowed competing owner to set the bars.
Any consumer product passes on the cost. If you buy a sofa, it is not just the cost of material, if you eat out dinner you don’t pay for just the food. On and on and on.
There was a time in my 40 years of experience where we could manage with compassion but then laws stopped that.

Renee Benson Sellers wait what? How does anything besides the market effect setting the price? Just because you got a bad loan, or expensive operations doesn't mean you can raise your price. I mean sure you can raise your price but if you are priced out of the market no one is going rent. You ever explain to a prospect that the loan on the property was really high to enact sympathy to get them to pay above market price for a rental????
After closing you do one single thing. Look at the market and set your rates competitively, or look at things you can change that will have a NET positive impact. You never look at the loan payment and work it backwards, that was something you were suppose to have done prior to closing to understand if you wanted the deal.

Miles Scruggs where did you come up with the fact or assumption it was a bad loan? All purchases require a 5, 10, 15 year plan. I clearly stated there is a market factor. When a group or individual buys a property they have to do a detailed business plan for the lender to approve just like if you bought a restaurant. The performa rent is detailed and it has always included recoup of operational expenses such as insurance, taxes and other overhead. So when the buyers team puts the plan together and compares it to comps those comps already have a rent that is inclusive of overhead.
If you live in a fantasy world then all owners pay properties so they can house people out of the kindness of their hearts. They are bought for a return on investment just like any other business. There are no owners sitting on yachts spending the rent money.
It cost a lot to operate a property and most owners do not rake in a return without doing a value add and selling or a long term hold for like 15 years.
Btw I am not brainwashed by owners I know how to read budgets, balance sheets and loan documents. I can read and understand a business plan.
If this business has been your career and not just a job you know what you are suppose to know.
People don’t buy restaurants or grocery stores just because they want to feed people, those are businesses too so why is it so difficult to understand Property Management is a business.
Even Healthcare is a business.
If you think all these industries are not businesses you have your head in the sand and yes they have always been businesses so it is not anything new.

Renee Benson Sellers I was just reading your statement: "...walk out of a property closing saying I am going to set my new rents at $$$$$$. The market, the loan, the cost for operation are all part..." I still don't follow how loan, operations etc, effect how you set your rents. Again you use a loan or operations as a justification to set rents higher than the market then all you've done is taken a huge loss with increased vacancy.
I completely get proforma and a plan, but the plan (with the exception of improvements and operational changes) is all in the rear view mirror after the closing. Not much else matters how your units stack up in the market. Also every single proforma I've ever seen is designed around an extremely optimistic borderline delusional outlook. Most times they are written to sway a bank to loan more capital for the purchase or refi.
I'm not sure who you were writing your whole dialog on investments and businesses but I doesn't appear to be relevant to our conversation although it is extremely obvious.

Miles Scruggs my comments were based on the fact people appeared surprised that property tax, common area and other operational cost were part of rent. Like they never thought it was or should have been. It has always been part of rent. I was trying to state was apparently not obvious to some.
Lenders are smarter than maybe they were in the past especially after 2008-2010 meltdowns were so many properties went into foreclosures.
I am just surprised at how many people seem to be in awe of how business works or believe that this industry is not a free market.
I guess they never worked where housing pays more than the asking rents of their own choices or how Tax Credit properties are the same cost as a conventional site.

Renee Benson Sellers Ya lenders are smarter, mostly to the point that presenting them a proforma plan is nearly pointless. They are going to do their own underwriting and ignore the proforma smoke the borrowers are attempting to blow up their a....
While it is a free market it is a bit unique in that supply takes so long to spin up. So while there is the basic concept of supply and demand the balancing corrections take a long time. Investors and developers back in 2023 were buying dirt and by the time planning, design, engineering, permitting and development are done they are going to be coming online in 2027, meanwhile the market started to cool in 2024 pushed too far and investors that are over leveraged will be foreclosed on which drives down the asset prices which further compounds the problem when balloon payments become due.... then supply increases come to a screeching halt and the cycle repeats again but on a very long time window of 15 years or so. While I'm certain they exists I'm actually not aware of markets with slower response times than housing at scale.

This might have something to do with the new fee transparency laws that some states have put in place.

Looks like they may be a little too transparent with fees. Yes, rent will generally be used to pay for all of those things (because where else would this money be coming from) but it's very odd to line item them individually in a resident ledger. That's all stuff usually hidden in backend accounting, not fees individually charged to the resident. The base rent is understood to include operational costs and overhead. It's not meant to look like or be charged as individual fees.

Brooke Nuber-Soldate things have changed in Tx, we must disclose all fees upfront.

Nacole Orr fees yes, overhead seems different. I know there are price transparency laws in select states but this is not how it's supposed to work

I suppose that when companies got sued for increasing rates to make assets stay in the green and lost, they need to get more forward with what rent and additional income ACTUALLY goes towards. Property Tax and Insurance have made most ave size assets not feasible and the small ones are in real trouble.
I think its smart to be more forward with the fees. Noone can dispute that the property has to pay property taxes or insurance, and if residents don't want to pay it, they can go to another property that just builds it into the rent.

I do agree that is is overfeeing BUT I do think that forcing residents to see the expenses of owning and operating is not awful. Both for social / voting situations so non property tax paying people can see that tax increases affect everyone - just like we bill back for water so people can see that waste or usage affects everyone.
Just a thought / don’t be hating - just a different prospective.
🙂

The goal with this practice is to educate renters. This is not reserved to any particular management company or any particular property owner. Homeowners are directly impacted with property tax increases and they get to vote to have a voice for items that serve their interest. When these items are included in the rent, the property owner is then blamed for the increase and it is harder to educate the renter so that their voices can be heard when it comes to election items that impact property taxes. The goal truly is transparency and more clarity around where their rent dollars go. I also thought that this group was made up of individuals that support and work in the industry. Your Colorado apartment association would be a great source for education on this and other related topics

It's understandable why residents feel nickel-and-dimed. My son was apartment shopping recently and one community quoted a maintenance fee, "so if something breaks our team will fix it." Um, hello - isn't that why people rent?

On the other side, i’d like for rent to cover my p&i and unit charge for everthing on proponate basis by sq footage. Let the resident know his portion of taxes. Let him go to city council and ask how his tax money is spent. Let my tenant pay his part of common area maint. Lets see if he/she will now throw gum wrapper in parking lots.
See what it costs to maintain pool and club house. Keep it clean.
Oops. His/her portion.
Finally dumpster costs.
Now let your friends and family bring and fill up the dumpster. Extra Run is 490.00
May be make residents more responsible and less destructive?

Back in my day...we called it Nickel and Diming 😔

It would be weird if people were not allowed to enter into agreements that they wanted to enter into.
That said it is just math. You can break down the “rent” into as many line items as you want, itemizing shouldn’t be an offensive action. I guess it might be hostile to those who can’t basic maths.
This is similar to how things have been done for decades with commercial NNN leases.

It would be weird if people were not allowed to enter into agreements that they wanted to enter into.
That said it is just math. You can break down the “rent” into as many line items as you want, itemizing shouldn’t be an offensive action. I guess it might be hostile to those who can’t basic maths.
This is similar to how things have been done for decades with commercial NNN leases.

Miles Scruggs I'd like to address your sarcastic first comment. You're describing contract freedom, right? But residential leasing isn't a free market negotiation between equals it's a consumer contract of adhesion. The landlord writes it, the tenant signs it and if not they're homeless.
That freedom to "enter into agreements” as you put it, doesn’t really exist. Not signing the lease isn’t a genuine option, it’s economic coercion just dressed up as choice.
And when every property management company uses nearly the same fee structures, the same leases and rent optimization software, renters can’t simply “go elsewhere.” John Smith can’t refuse Terrace View and just rent across the street at View Terrace when they’re both doing the same thing. That’s exactly why RealPage is facing a nationwide class action lawsuit because the “competition” disappeared.
So your logic assumes a level of market freedom that renters simply don’t have and that’s exactly why laws like HB25-1090 are being written. Just because something is tucked into a lease doesn’t suddenly make it right or ethical.
Honestly, it might be worth remembering that the reason you have a job in this industry is because people need housing. A little more compassion for the renter side of that equation and a little less blind loyalty to ownership ideology, would go a long way.
It’s not that people “can’t do math.” It’s that they can and they can see exactly how the math is being weaponized to squeeze them under the guise of transparency. Numbers don’t lie, but people sure can hide behind them.
And just for the record, the argument that “this has been done for decades” has never been a moral defense for anything. Longevity doesn’t = legitimacy.

This isn’t exotic: most purchases present a take-it-or-leave-it price. You can’t rewrite the terms at the grocery store—you compare options and choose. And let’s be honest: housing is less consequential than the ability to feed yourself; if we accept market pricing for food, applying the same basic supply-and-demand logic to housing isn’t “coercion,” it’s how markets clear.
“Contract of adhesion” means standardized terms, not forced consent. The questions that matter are: Is it disclosed? Is it lawful? Are there alternatives at some price/quality point? If a neighborhood has thin supply, that’s a supply problem—not proof that itemization itself is predatory.
On RealPage: if there’s collusion or anticompetitive conduct, enforce antitrust. That’s a separate issue from whether breaking costs into components is legitimate. If the worry is cartel behavior, the remedy is competition law—not banning line items.
HB25-1090 mainly pushes toward a single “sticker price.” Fine for comparison shopping, but it doesn’t change arithmetic. One line or thirty, totals still total. Calling itemization “weaponized” assumes renters can’t read a ledger; most can, and many prefer to know what’s utilities, what’s common-area, and what’s taxes/insurance pass-throughs.
Transparency empowers renters. Itemization lets people see why costs move:
• When a city or county hikes property taxes, the “property tax” line goes up and the source is obvious.
• When insurers double premiums year over year, the insurance line shows that external shock.
• When utilities raise rates or add surcharges, the usage/utility lines reveal it.
That visibility lets renters audit changes, push back on errors, compare buildings apples-to-apples, and advocate where the cause actually sits (jurisdictions, utilities, insurers) rather than blaming a single blended number. One price is simplicity; it’s also obfuscation.
Market power isn’t one-way either. Oversupply in many places has shifted leverage toward renters—softening rents reflect that. When supply loosens, line-item or not, prices come down.
My NNN example wasn’t “longevity = legitimacy”; it’s that in a mature segment, even sophisticated parties insist on components for clarity. Starbucks isn’t “oppressed” because CAM/insurance/tax are listed separately—clarity is the point.
For what it’s worth, we don’t itemize because many renters find it annoying. But morality doesn’t turn on formatting. If totals are lawful, disclosed, and non-duplicative, ethics aren’t changed by whether a ledger shows 1 row or 30. If someone is double-charging or mislabeling, call that out; “itemization” isn’t the culprit.
If the objection is to prices, let’s talk supply, zoning, and antitrust—changing the shape of the receipt won’t move the market.