My wife and I are just about to close on our first rental property. It is a mixed use unit with 1 commercial and 4 residential properties. To start, my wife is going to do the daily property management duties and I oversee big decisions and help out. It has been a long journey from deciding we wanted to get into rental properties to actually finding something we were interested and getting through all the details.
I have gone through many posts, web pages, etc, about Accounting Software (most people seem to use Quickbooks) and seen many posts about "Property Management" software. What I can't figure out is there a single solution for both. Something that can help me track my units in my property (and future properties) as well as cover all the expenses/incomes the business will occur to make it easier for me or an accountant at tax time. My wife is currently planning on just using Excel, but I suspect, we will find the limits of that quickly.
So, for all the solutions out there, are there ones that provide the "whole package" for the small number of units have have, or we just best off with Quickbooks (haven't ever even tried, I am software savvy, but my wife thinks too much software will make her life harder) and keeping track of tenants and specifics about late rent, etc, on our own?
Throughout this entire process, I have found that I don't know the answer to most of my questions until I am deep in it (for example, it took me talking to several commercial lenders about various different properties before I could really grasp how commercial loans worked (and their various different products, etc). Because of this, I have been furiously trying to research the "right" solution before we have even closed on our property (which is driving my wife nuts, and she is the one who would benefit), going as far as signing up for free trials of several solutions to see what they felt like (tried Rentigo, Rentulations, and SimplifyEm), but haven't been excited about what I have seen (none of those provided enough that I wouldn't need Quickbooks, some where ugly, some more then we need, etc).
Any advice on where to start? Do we start with Quickbooks online as well as Excel or something for renter specific things (tenants, etc)? Do we just try to do the whole business using an Excel spreadsheet?
Thanks in advance for any advice! Lots of things to learn!
What a shame that most people don't know the actual power of QUICKBOOKS. And yet, if you purchase QuickBooks Pro at Amazon.com, you can most likely purchase it for about $239.00 (Approx) and it's a tax write off.
Today I'm going to show you the things you didn't know QuickBooks can do.
Let's start by QuickBooks allowing YOU to enter in your rental properties, and have it show you all the things you want to know about that property. Let's take a look.
This is in the Fixed Asset Feature of QuickBooks. You can customize this form to show you what you want to see. I wanted to see:
- My rental address
- The date I purchased this property
- What type of dwelling it is
- The year it was built
- How much I paid for it
- How many square feet
- What I sold it for when and if I sell it
- When I received my Certificate of Acceptance
- When I received my Certificate of Occupancy
What would you like to see on your form? Just fill out the form in QuickBooks and your wish is fulfilled.
Let's take a look at it the fixed asset feature even further. The above screen shot is just a Table of Contents for the actual data for this particular property.
When you setup your rental property in QuickBooks in the Fixed Asset Feature, this form will appear and you will fill it out.
You will fill in the name of the rental property, purchase date, cost, etc. Type of rental (asset) location and I like typing in the Notes window the land description, I'm always having to look it up it seems, so I wanted it handy.
The right side of the form is for purchasing a home. The left side is when selling it.
Based on the information entered on this form, I was able to create the first form that I showed you.
Let's take a look at something else I bet you didn't know QuickBooks could do. QuickBooks will show you via colorful graphs where you stand today financially. How much money is owed to you. Expenses, etc.
Let's take a look at another screen shot.
This will show you in colorful details all about your tenants. Who owes you what, if they are past due. Etc.
Let's take a look at some more.
QuickBooks even has a LEAD INFORMATION SHEET for potential customers!!!!
QuickBooks allows you to see all your properties at a glance and how much income they made for you, expenses you dished out and their bottom line.
And QuickBooks will allow you to view each property individually to see how much that property made you in income less expenses equaling your bottom line.
YOU CAN DESIGN YOUR OWN INVOICES.
I DESIGNED AN INVOICE CALLED TENANT BILLING. I designed it to tell me
- the tenants move in date,
- security deposit,
- rental amount,
- and lease type.
- They are easy to designe, however, when you purchase my book you receive my Chart of Accounts, Items List, and Templates (like the one below) free with a proof of purchase of the book sent to me via e-mail.
HERE IS A SECURITY DEPOSIT RECEIPT TEMPLATE I DESIGNED. ONCE AGAIN the tenant and I (the landlord) am able to see at a glance the tenants Move in Date, Security Deposit, Rental Amount and Lease Type. You can even have the Lease Expiration date on here as well if you choose.
I like taking notes about my tenants and things that go on inside my business. So I designed a template called Notes. Just like the sticky notes you see. I type in my notes and print them out and stick them into the tenants physical files, or I just may not print them out until the tenant actually moves and I make their account inactive in QuickBooks. Whatever you choose to do with your notes is up to you.
Frankly, I could go on and on and on as to what QuickBooks can do for you. Some tell me, yea but ya have to customize it to do all this stuff. That's true , but not all the stuff. And if you can fill out a form, you can customize QuickBooks. It's not like you have to be an engineer and sit down with a pencil and paper and plan your design.
So now...you know the rest of the story.
Single solution for both accounting and property management needs will suffer in one or another way, after all they are for solving different class of problems. If you do your own accounting I would go with accounting software that has some property management extensions like @Account Closed suggested. If accounting is done by your accountant I would look for property management solution that lets you export data to share monthly income and expenses with your accountant. Sounds like mobile apps e.g. Landlordy, Housters and alike could be good fit for your wife for tracking tenants, rent income and expenses.
Actually CPA's use QuickBooks as well, and all you have to do is send them an Accountant's Copy of your data with a simple click of a button. Send it via E-mail, they import it into their QuickBooks, they fix anything that is wrong and they send it back to you, and all is well.
Quickbooks is a good solution and does many things, but takes some learning. I know people do not like this solution but if you are looking for something simple and easy to use, try Quicken rental Property Manager. you can track Personal, Business and Rental Property information on it. It's easy to set up and you can keep track of the property and each unit in that property, rent tracking and you can customize your bills and invoices there too. you can track all expenses by property by Tagging the expenses then you customize reports to show them by Tag ( property or unit ) and you will know everything for your property that you need to know, and you can send a copy to your accountant too. Intuit no longer owns the product, even though the product hasn't changed a lot i think they are working on making it a better product. and for the record, i use both products for my multiple businesses.
Not to hijack this thread, but I was wondering if Quickbooks would also be recommended for owner occupied multi family properties? Or is that outside of its normal usage?
QuickBooks will work for you too Kenneth. No problem.