Is accounting software needed?

Question

Howdy all,

My wife and I have two rentals that we just finished the BRRRR process on, and I was wondering how many people actually use an accounting software to keep up with things? I planned on using quickbooks, but was unsure on if other investors typically use an accounting software at all. We do have a CPA that we work with as well as a property manager who manages our properties, if that makes a difference.

Thanks in advance!

Gita Faust · Answer

Low-cost software is Zoho and we love it. Remember the key to software is so you can compare Months, Qtr, and Years of data, pull reports of all your repairs and improvements and the list goes on.

Daniel Hyman · Answer

@Cody Mitchell

Spreadsheets are fine. If you really want to dip your toe in the waters of accounting software, you can try Stessa or Landlord Studio at low or no cost.

Daniel Hyman · Answer

@Cody Mitchell

Good question. I think it depends on how rapidly you intend to scale.

If you are certain that you are scaling up quickly, then it makes sense to jump into software. Otherwise, keep it simple with a spreadsheet and then transition into the software at a later date. We typically see that transition take place at 3-4 properties.

Theresa Harris · Answer

I have a few rentals and don't use any software.  I separate my receipts for each property and use a notebook to keep track of each type of expense.

Cody Mitchell · Answer

As a CPA, for your investors with multiple rentals, do you advise they use spreadsheets? The reason I ask is we will be acquiring more properties so I would like to get the systems in place now so it's easier as we scale. Thank you for answering my questions!

Chris Seveney · Answer

For two rentals I would use excel, and typically if you have a PM you just take the monthly reports and give to your cpa. I do not believe quickbooks is needed

Cody Mitchell · Answer

Thank you for the explanation and the tip! I will check out Zoho for sure.

Cody Mitchell · Answer

We only have two rentals currently, but I should have mentioned that we do plan on scaling and acquiring more in the coming years. With that in mind, do you still think I don't need quickbooks? I appreciate your advice!

Is accounting software needed?

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