Part of the Maintenance Documentation pillar guide. The approval threshold is stage 4 of the five-stage record covered in the pillar.
You manage 32 units across 18 properties. None of them are yours. Every dollar you spend on a repair comes out of someone else’s account.
A water heater fails in Unit 4 of a duplex you manage for an out-of-state owner. Your plumber quotes $1,150 installed. The tenant has been without hot water for 18 hours. The owner is on a flight to Europe and hasn’t responded to your text from two hours ago.
What do you do?
This is the situation an approval threshold is designed to handle. Set it correctly, and you have a clear answer. Set it wrong (or not at all), and you have a coin flip, and a probable owner complaint either way.
What an approval threshold is
An approval threshold is a dollar amount, written into your management agreement, above which you must obtain the owner’s written approval before authorizing work.
Below the threshold, you have standing authority to spend without checking. The owner is delegating routine maintenance decisions to you, which is the whole point of hiring a property manager.
Above the threshold, you stop. You contact the owner, describe the issue, present the quote (or quotes), and wait for written approval. Only then does the work happen.
There’s almost always a carveout for emergencies, defined narrowly, usually limited to issues that pose a threat to health, safety, or cause ongoing property damage. See our emergency vs non-emergency guide for the standard definitions.
What happens without one
Property managers without a clear approval threshold default to one of two failure modes.
Failure mode 1: ask permission for everything. You text the owner about a $45 garbage disposal. They get annoyed. You text them about a $90 outlet replacement. They get more annoyed. By the time you text them about something they actually need to weigh in on, they’ve stopped reading your messages.
Failure mode 2: ask permission for nothing. You authorize a $1,400 HVAC repair on a 2009 system, because the alternative is leaving the tenant without heat. The owner sees the invoice three weeks later. They wanted to replace the system, not repair it. Now you have a dispute over $1,400 of work that’s already done and can’t be undone.
A threshold solves both. Routine stuff goes through without bothering the owner. Substantial stuff stops at the gate.
Setting the number
There’s no universal answer, but there’s a useful range. For most residential portfolios, somewhere between $300 and $500 is the right starting point.
What pushes the number down
- The owner is hands-on and wants to be involved in decisions.
- The property is older and has higher repair frequency, so even routine work gets expensive.
- The owner has a tight cash position and can’t absorb surprises.
- You’re new in the relationship and trust hasn’t been built yet.
For some owners, $200 is the right number for the first year. Once you’ve demonstrated good judgment for a few cycles, you renegotiate up.
What pushes the number up
- The owner is hands-off and explicitly doesn’t want to be bothered.
- The property is newer and most routine repairs are small.
- The owner travels frequently and can’t respond quickly.
- You have a long track record together.
For some long-tenured relationships, $1,000 is reasonable. The owner trusts you. They don’t want to hear about anything under that, and they’re confident you’ll exercise judgment above it.
The carveouts
Whatever number you land on, the management agreement should also specify:
Emergency carveout. You can authorize spending above the threshold without prior approval if the work meets a defined emergency standard. You commit to notifying the owner within 24 hours, in writing, with the quote and a summary of why you proceeded.
Recurring expenses. Things that happen every cycle (HVAC servicing, gutter cleaning, smoke detector batteries) are pre-approved up to a budgeted amount per year, not subject to the threshold.
Per-unit cap. Some agreements add a monthly or annual cap on total spending without approval, separate from the per-item threshold. This catches the situation where you authorize ten $400 repairs in a month and the owner thinks they should have been consulted on the cumulative spend.
The workflow that has to exist
The threshold is a number on a page. It works only if you have a workflow built around it. The workflow has four pieces.
1. The approval request
When a repair is going to exceed the threshold, you send the owner a clear written request. By email or text (whatever channel you’ve agreed on) but always in writing.
A good approval request includes:
- The unit and the issue, in plain language.
- The vendor’s quote, attached or pasted in full.
- A second quote, if the cost is high enough that comparison shopping is warranted.
- Your recommendation, with a short reason.
- A response deadline based on urgency.
Example:
“Re: 412 Maple, Unit 4. Water heater failed this morning, tenant has no hot water. Smith’s Plumbing quoted $1,150 installed, can do it today. They’ve done two other water heaters for our properties this year, both fine. Recommending we proceed. Please confirm by 4 PM today or call me., Austin”
That’s 65 words. It contains everything the owner needs to decide.
2. The approval itself
The owner replies in writing. “Approved” is enough. “Approved at this price, please proceed” is better. A phone call is not enough on its own, if you take a phone approval, follow it immediately with a text or email confirming: “Confirming our call: approved $1,150 water heater replacement at 412 Maple Unit 4, Smith’s Plumbing, work today.”
Without the written record, you have nothing to show when the owner forgets they approved it. They will sometimes forget. People do.
3. The completion record
Once the work is done, the approval, the invoice, and the completion photos all live on the same record. When you send the monthly owner statement, the $1,150 line item is backed by an approval thread, an invoice, and before/after photos.
The owner who could otherwise have said “what was this for?” has nothing to ask. They click through, see the trail, and move on. This is what good tracking property maintenance actually delivers.
4. The escalation path
What happens when the owner doesn’t respond? You need a defined fallback.
A reasonable rule: “If I cannot reach the owner within [4 hours / 24 hours / 48 hours, depending on urgency] and the work is necessary to prevent further damage or habitability impairment, I’m authorized to proceed at my discretion up to $X.” This way, the owner can’t ignore your requests and then later complain that you acted unilaterally.
Communicating the threshold to owners
When you onboard a new owner, the threshold is one of the first things you cover. It needs to be in the management agreement, in writing, with both signatures.
The conversation goes something like:
“We’re going to set the approval threshold at $400. Any repair quote above that, I’ll send you in writing for approval before work starts. Below that, I’ll just handle it and you’ll see it on your monthly statement. There’s an emergency carveout, if something is causing active damage or a health-and-safety issue, I’ll authorize the fix and notify you within 24 hours. Does that work for you?”
Most owners say yes. The owners who push back usually want a lower number, which is fine, set it at $200 if they want $200, you’ll renegotiate after you’ve built trust.
The owners who want no threshold at all (full delegation, no approval needed for anything) are a yellow flag. It sounds convenient, but it’s the relationship most likely to blow up when an unexpectedly large repair comes through. Push back gently and insist on at least a high threshold.
Communicating it to vendors
Your vendors need to know the threshold too. Specifically: above the threshold, stop work and call you. Don’t keep going just because the customer (you) is on site.
A good vendor onboarding document includes a line like:
“For any job estimated above $400, pause and call before proceeding. We may need to get owner approval. This protects you from doing work that doesn’t get paid.”
Most vendors appreciate this, they’ve been burned before by jobs that escalated mid-repair without anyone authorizing the new scope. A clear rule is a courtesy to everyone. See our vendor management guide for the rest of the onboarding kit.
Common mistakes
A few patterns that show up over and over.
No threshold at all. Every property manager who’s been in business for a year has the story of the time they spent the owner’s money without checking and lost the relationship. Don’t be the one repeating it.
Threshold set but never enforced. You set $400 in the agreement, but you authorize $800 jobs without checking because “the owner trusts me.” This works until it doesn’t. The first time it doesn’t, the trust evaporates.
Approval requests with no quote attached. You ask the owner “okay if I have the plumber replace the disposal?” without a number. They say yes. The bill is $400. They’re surprised. Always include the number.
Verbal approval, no follow-up text. The owner says yes on a call. Then forgets. You have no record. Send the confirmation text immediately, every time. It takes 12 seconds.
Emergency carveout used too loosely. The carveout is for actual emergencies. A water heater that failed Friday afternoon is not an emergency by Monday morning if the tenant is out of town. Use the carveout sparingly, and document the reasoning every time.
The bigger picture
Approval thresholds are a small piece of a larger principle: every dollar spent on someone else’s property generates a record that the owner can review later. That record should be complete, dated, and easy to navigate. If it is, the owner relationship survives almost anything. If it isn’t, even normal expenses become arguments.
The Maintenance Record flow exists to make that record automatic. Every repair captures the approval thread (when there is one), the quote, the receipt, the photos, and the tenant sign-off, ending in a PDF you can attach to the monthly owner statement. The threshold is the rule. The record is the proof.
