Operating Expense Ratio (OpEx Ratio)

The operating expense ratio tells you what fraction of a property's income is eaten by running it.

opex_ratio = operating_expenses / effective_gross_income

Effective gross income means income after vacancy and collection loss, including extras like parking or laundry.

Reading it in both directions

A high ratio can flag operational inefficiency, expensive management, or deferred maintenance catching up. A suspiciously low ratio deserves equal scrutiny: it often means the underwriting left something out, and the missing expenses will surface as cash flow problems later. Use the ratio to compare similar properties in the same market and to sanity-check any pro forma handed to you.

Where you'll see it in Rescover

The APOD table on every analysis lays out income and each operating expense line explicitly, so the ratio, and anything hiding inside it, is inspectable rather than asserted.