A recurring cost of operating and maintaining a rental property, excluding financing and commonly excluded capital costs.
What operating expense means in practice
Examples often include property taxes, insurance, management, routine repairs, utilities paid by the owner, and supplies. Consistent categories make property comparisons and NOI reports more useful.
Example
A monthly landscaping invoice is recorded as an operating expense rather than a mortgage payment or capital improvement.
This glossary is educational and not legal, tax, lending, or accounting advice. Rules and terminology can vary by jurisdiction and professional context.