Costs/Revenue for June

This is a somewhat difficult post to write as I know full well the revenue is in hand and all the bills haven't arrived yet.  We use cash based vs accrual accounting so this is how it goes on the books. Nonetheless - as promised, here are the actual dollars for June.  These are the operating costs, not upfront purchase costs, I will comment briefly on those at the end.

Revenue:

Pro-rated rents received at closing = $2200.00

Collected past due rent = $525.00

Application fees = $140.00

Total Revenue  $2865.00

Expenses:

Utility deposits and turn-on fees = $1000.00

Minor repairs (this excludes planned capital expense) = $206.00

Insurance = $605.00

Tax reserve = $233.00

5% Maintenance Reserve =  $143.00

10% Management Fee =$287.00

Lawn care = $110.00

Total Expense $2584.00

Net Revenue $281.00

Not exactly getting rich yet am I?  I did collect a management fee so that's some small consolation.  And I'm not in the hole for the month they were purchased which is considerably more consolation.  Realistically, this is just stumbling about in the first month.  Most bills are not received including the first mortgage payment.  I did however, pay large utility deposits and double insurance for the first month. On the other hand, total revenue was less than 50% of the rents and we have rented an additional unit.  So far, it's working.

On the reserves, I budgeted maintenance at 10% but in the short term, I will be spending most of that on repairs.  At the same time, I will be setting aside 5% regardless of actual expense to build up a maintenance account to prepare for those big scary expenses that always come up.

Notice this accounting doesn't include deposits, those go into a separate escrow account.  I have rented the first garage apartment and received $300.00 deposit on $400.00 rent.

As far as purchase costs, I paid 10% down with $5000 in earnest.  At closing, after tax, rent, and other adjustments, I had to cough up an additional $7416.00.  Insurance was paid for closing but since it is a monthly cost, I went ahead and included it in June expense.

I am sweating the utility bills a little bit... they are still the unknown as the prior owner was simply unable to account for them in any meaningful way.  I'm also fixing all the slowly leading toilets, having purchased a bulk quantity of universal flappers.

That's the first month in  a nutshell.  July will provide a far more accurate accounting.