Quickbooks or something else?

61 Replies

Hello All, 

So i am in this ever learning adventure to better my investments, i recently asked about managing the properties myself, i have always hired PM in the past so far and one very detailed post mentioned that she recommend that i purchase Quickbooks Pro and start learning the software now before i start self managing so i could do things right from the start. Since this would be all new to me, is there truly a better alternative or a reason i would really need to use quickbooks? Just curious as i have spent some time learning Podio and i am thinking i may be able to do the functions i need to do with quickbooks with podio for free or is there something specific i need the quickbooks for that i am unaware of since this is all new to me. 

Also if there is something better please give suggestions, i use an accountant to do my taxes on my current properties, i just send them the info. 

@William Huston , you'd be overdoing it if you purchase Quickbooks Pro.  QB is a general accounting software that can be used for nearly all small businesses.  However, you're not really a small business; you're going to be a property management company so get yourself some good property management software.  All the good ones have a robust accounting module as part of the platform, so you'll be good to go.  You can also list your properties, have prospective tenants apply online, screen them, accept online payments from them, and have them enter work orders online.  Does QB - Pro or not - do any of this?  I don't think so.  Look into Rent Manager, Yardi Breeze, and Appfolio all of which are very good.  However, I've heard particularly good things about Rent Manger.  Best of luck to you.  

Originally posted by @David Cruice :

@William Huston, you'd be overdoing it if you purchase Quickbooks Pro.  QB is a general accounting software that can be used for nearly all small businesses.  However, you're not really a small business; you're going to be a property management company so get yourself some good property management software.  All the good ones have a robust accounting module as part of the platform, so you'll be good to go.  You can also list your properties, have prospective tenants apply online, screen them, accept online payments from them, and have them enter work orders online.  Does QB - Pro or not - do any of this?  I don't think so.  Look into Rent Manager, Yardi Breeze, and Appfolio all of which are very good.  However, I've heard particularly good things about Rent Manger.  Best of luck to you.  

Thank you for your input, i looked into 2 of the 3 and they require you to have like 50+ units to use the service. I am looking for like under 10.

I came across Cozy as a possible option, is there things that i would need that cozy is missing?

For a few properties you need accounting, rent collection and repairs tracking.

You can be as fancy or as simple as you like.  If you enjoy recordkeeping and database management and doing computer work, and you are going to be disciplined about updating your system, then by all means get QuickBooks or buildium or whatever.  

But if that's not you, then don't force yourself to become that.  Cozy for rent collection and a spreadsheet for finances and whatever works for you to help you remember the last time the furnace filters were changed or whatever.

Create a system that works for you.  Don't try to redefine yourself to fit a system that works for other people.

Okay, all this talk has triggered my buttons.  

Whether you own one house or 100 houses you are a "Business".  The IRS will see you as a "Business".  You should have an accountant and they will view you as a "Business".  

If you don't recognize yourself as being a "Professional Business Person" then don't expect your tenants to view you as a "Professional Business" as well.  You will be just some person that's renting your home.  

Whether you own one house or 100 houses, you want to keep track of your finances with a software program that will grow with you as you grow.   You will want a software program that will give your "hard money lender" a look as how professional you really are, and that is done through organization, with a good and detail record keeping.  

Sure you can buy cheap junk software that will keep track like an Excel Spread Sheet or online programs, but when it comes down to protecting yourself with documentations in regards to an eviction, nothing will compare to QuickBooks when it comes down to evidence that you will need in a court of law.  

Whether you have one property or 100 properties, you should always present yourself as a "business person" who has it all together, right down to the penny.  Who can provide data to anyone who asked, whether a court, an inspector, a tenant, a money lender, or whatever,  you will have it ready for them in seconds and it will be organized, and it will be perfect, and they will look at you as someone who they will listen too and take seriously.

If you think being a Landlord is a Hobby whether you have one property or 100, you better think twice about that.

YOU are responsible for the neighborhood, (depreciation of it, it's safety) and you are responsible for the people who live there, in your home, to have a safe and comfortable experience while they rent from you.

YOU have more responsibility than most other Industries.  Whether you have one property or 100 properties, people will look at you as either a good landlord or a bum.  

This is a SERIOUS BUSINESS, and you deserve to have the best software program out there for OUR INDUSTRY, that will protect you and give you the evidence and documentation that you need and when you need it. 

I was a landlord for many years in a very tough city, if I hadn't have had Quickbooks to help document everything that went on in my business we wouldn't have lasted 30 years in the business.

I highly recommend QuickBooks Pro Desktop !!!

Nancy Neville

@William Huston we manage 9 properties using Excel spreadsheets. There is three types of things we track. Income, expenses and mileage. Expenses are tagged by category to match taxes. We give the spreadsheet to our accountant along with the receipts. 

Excel is great because it is fully customize-able, easy to use and the format is universal. I have seen so many software packages come and go over the years, with conversion necessary to move to new programs. Excel can read files from 20 years ago and everyone knows how to use it.

We use Cozy for rent payment and screening, but not for tracking expenses.

If you were managing large volumes of properties, I would agree you should use specialized software, but for 10 or 20 properties, it is just not worth it.

I am an Accountant, having said that I would encourage you to do what you need to do for you to feel like you have it all under control.  For ten properties I would say use Excel or a spreadsheet you like using. 

I have a client that has 7 properties, 2 times a year he brings me his files.....7 boxes with everything to do with those properties including the mortgages.  I do use Quickbooks Pro, but I have many clients that I do books for. It takes me about 6 hours to do all 7 properties twice a year. Then I do his taxes separately....The reason for twice a year is he runs this business July 1 through June 30. As he is in a warmer climate in tax season. 

Tag me know if you have any other questions.

@Nancy Neville your quote "Sure you can buy cheap junk software that will keep track like an Excel Spread Sheet or online programs, but when it comes down to protecting yourself with documentations in regards to an eviction, nothing will compare to QuickBooks when it comes down to evidence that you will need in a court of law."

First of all, Excel is hardly junk software. It is the most recognized number tracking software in the world. Secondly, the idea that a court will care if you use QuickBooks is silly and reveals your lack of experience in evictions. Yes the court cares about record keeping, but it could be records in a notebook for all they care. 

More important than software is quality of record keeping. No matter what software you use, it is only as good as the people using it. I see it all the time with people I contract to do work. I have a landscaper who uses Quickbooks, but I don't get billed until months after the work is done. He sometimes forgets to bill me. People make the mistake believing software will organize a disorganized person. 

@William Huston Buildium is a good property management software as well that I use to self manage my rentals.

Joe:  I was a landlord in the  City of Detroit for 13 years (husband 30 years) and I handled my own cases and I never lost a case ever.  

When I refer to QuickBooks being the best, it is because it provided professional data, Tenant History that impressed the Judges no matter what court I was in.  My evidence and documents printed out in such a neat an organized manner, impressed them to where they looked favorable on me as a business woman who knew what she was doing. 

Excel is good for the home, but what business, big business uses Excel for their data entry?   Excel has it's purpose and it's place, but not in what we do.   

Real Estate Brokers even use QuickBooks. 

And I'm talking about OUR INDUSTRY.  The Landlord Industry.  Where WE CAN CUSTOMIZE QuickBooks to fit our own Industry.  There is none better than QuickBooks for Customizing. 

I agree that any thing is junk if we don't use it properly.  That is a given.  I'm talking about Landlords who think just because they only have one property or two, don't need to have a software that will give them the data that they so desperately need.

How many times have you tried to find something in your file cabinet that you needed right away, because you are on a phone call regarding a matter, and you just can't seem to find the physical document?

Of course Excel is not Junk, but it is junk if we depend on an Excel program to provide us the data that we need that will please a Judge.  It's a baby compared to what we need. 

We invest tens of thousands of dollars into our business.  We need to be a little bit smarter than just using Excel.  

I've been a landlord a very long time, I know what I'm talking about.  Whether anyone believes me doesn't matter.  I'm just giving my advice based on 13 years as a Landlord and an additional 10 years in Real Estate.  And I've been using QuickBooks since 1998.  

I'm not an employee of QuickBooks.  I am a retired landlord and a believer in QuickBooks who wants to help others on here know what will work for them and why.  That's all I can do.  And that's all I'm trying to do now. 

Nancy Neville

Originally posted by @David Cruice :

@William Huston , you'd be overdoing it if you purchase Quickbooks Pro.  QB is a general accounting software that can be used for nearly all small businesses.  However, you're not really a small business; you're going to be a property management company so get yourself some good property management software.  All the good ones have a robust accounting module as part of the platform, so you'll be good to go.  You can also list your properties, have prospective tenants apply online, screen them, accept online payments from them, and have them enter work orders online.  Does QB - Pro or not - do any of this?  I don't think so.  Look into Rent Manager, Yardi Breeze, and Appfolio all of which are very good.  However, I've heard particularly good things about Rent Manger.  Best of luck to you.  

 I will have to respectfully disagree with you on this one William. By your definition of a "property management company", a small business is EXACTLY what he is. 

As for my preference, I have only a handful of rentals but i absolutely LOVE Quickbooks. I can see at a glance all of my reports, what property is making what, which tenants have paid vs which are late, I can send a tenant an account statement within 30 seconds, I can see every contractor i've paid and which property they've worked on, I can print checks on the spot, and taxes every year are a breeze. I am so glad i started early with QB so that my knowledge of it will grow along with my needs along with it's value.

Where would Freshbooks fit into all of this?
Originally posted by @Nancy Neville :

Joe:  I was a landlord in the  City of Detroit for 13 years (husband 30 years) and I handled my own cases and I never lost a case ever.  

When I refer to QuickBooks being the best, it is because it provided professional data, Tenant History that impressed the Judges no matter what court I was in.  My evidence and documents printed out in such a neat an organized manner, impressed them to where they looked favorable on me as a business woman who knew what she was doing. 

Excel is good for the home, but what business, big business uses Excel for their data entry?   Excel has it's purpose and it's place, but not in what we do.   

Real Estate Brokers even use QuickBooks. 

And I'm talking about OUR INDUSTRY.  The Landlord Industry.  Where WE CAN CUSTOMIZE QuickBooks to fit our own Industry.  There is none better than QuickBooks for Customizing. 

I agree that any thing is junk if we don't use it properly.  That is a given.  I'm talking about Landlords who think just because they only have one property or two, don't need to have a software that will give them the data that they so desperately need.

How many times have you tried to find something in your file cabinet that you needed right away, because you are on a phone call regarding a matter, and you just can't seem to find the physical document?

Of course Excel is not Junk, but it is junk if we depend on an Excel program to provide us the data that we need that will please a Judge.  It's a baby compared to what we need. 

We invest tens of thousands of dollars into our business.  We need to be a little bit smarter than just using Excel.  

I've been a landlord a very long time, I know what I'm talking about.  Whether anyone believes me doesn't matter.  I'm just giving my advice based on 13 years as a Landlord and an additional 10 years in Real Estate.  And I've been using QuickBooks since 1998.  

I'm not an employee of QuickBooks.  I am a retired landlord and a believer in QuickBooks who wants to help others on here know what will work for them and why.  That's all I can do.  And that's all I'm trying to do now. 

Nancy Neville

 Just FYI Quickbooks downloads to Excel.  So those forms you see are Excel based. you can also at anytime upload from Excel. 

@Shane H.   and @Michelle B.   

I agree that QB is a powerful program for accounting. However, there is a big learning curve. For example, the terminology is completely different. You don't have tenants or expenses, it is called something else. Also, QBO is different from the desktop version, so any step by steps for desktop useless when using QBO.

Shane and Michelle, do you have any sources or information that is available on Landords using QBO properly?

@David S. The learning curve is present just as there is with any new software but it is a much smaller curve learning with 1 or 2 properties vs waiting until there are 15+ to manage. I'm not sure what you mean exactly as expenses are still expenses, but you do use classes for properties. 

As for your questions about QBO, unfortunately I don't use it as i can't justify the monthly expense so i don't have much to chime in on that front. You do bring up another good point though, since Quickbooks is so widely used there are a ton of resources you can use to learn it. I'm a huge fan of Youtube-University. 

@William Huston I'm new at this. Just purchased one property last month and will close on my second property next week and searching for my third. I'm using Quicken Home and Business. I did not compare it with Quickbooks, but looked at cozy, rentecdirect, excel and a few others. Quicken was the choice for me.
I use Excel to track income and expenses for rentala and just format it like the schedule E. I also use Excel to assess any potential purposes. It’s a great analysis tool. It’s probably not pretty, but it’s very flexible and I’m very comfy working in Excel.

Great thread. I'm need something that really is easily learned.  My CPA suggested Tiller. That one is way to advanced for me. I just see a bunch of rows and have no idea of all the hundreds of tabs and buttons.  Im thinking QuickBooks or Quicken.  Probably Quicken.

I'm pretty sure Podio is not for accounting. 

If you have around 10 properties, I would suggest QuickBooks. One benefit of QuickBooks over Excel is that you can download transactions from your bank.

While I like the idea of QuickBooks online, you need to pay $60/m to properly do your accounting with QuickBooks Online, so my recommendation will be to go with QuickBooks Desktop Pro version. It'll be very difficult to use it right without any help, so I would suggest to get a book specifically written for a rental proeprty investors. 

This post has been removed.

I use Quickbooks Desktop to operate Real Estate businesses. I switched over since year 2002, and saw  constant improvements on it over time.

For accounting and taxes, I had my chart of accounts and Income statements mirror the Schedule E, so there would be no need to map items to tax software. I print out my income statement and my CPA prepare the taxes from it. I done my own taxes and schedule E myself without a CPA for a few years.

Many small businesses are on QuickBooks. My CPA who does my taxes only started using it for his clients in the last few years, and at first call me up when he had questions, but he's all up to date on it now. Through him, I got some of his clients up and running on QuickBooks, and even did the books for some of his clients.

I was also hired to do bookkeeping for a small non-profit, and handled everything including payroll. At this place and some other businesses I reorganized things and found a major time waster is filing receipts, bills, and then and have to look for them later and not finding them. With QuickBooks, since I'm able to extract information by customer, vendor, or account code, I no longer file invoices and bills by customer or vendor file, I file them by check number. For instance, the electric utility in my area is Con Edison, and if I want to see the Con Ed bill from April, all I do is pull up the Con Ed vendor file which displays all the bills paid, find the check number for the bill paid in April, go to the bills paid in April file, and it's there. When I do my bills, I don't have to go to dozens of files to file the bills away, I just file them in one bill file for the month, and when the month is finished, and I start a fresh file the following month.

My boss at the non-profit was annoyed at first I organized my files this way as she was used to vendor and customer files. But through time, whenever she needed something, I pull up QuickBooks, look it up and pull the documents in a minute while she's standing there, without shuffling through a ton of files, I made a believer out of her too. For instance, she said she made a stove repair upstairs sometime last summer, don't remember who it is, can I look it up. I said sure, looked it up in QuickBooks under repairs, found the repair bill, went to the month filed, pulled it, and gave her the copy, all of it in a minute. The old way, the problem is, she don't even remember who it is.

I’m a professional bookkeeper and I have a question for those of you that use something other than QuickBooks....

What’s your Profit & Loss YTD for each property? If you can’t answer that in 2 minutes or less, you are using the wrong product to track your rentals or property management business. This is info you need to run your business and info your CPA & a lender would want as well. 

Excel, Quicken, etc. are all great tools that have their place...but not in accounting. 

There are plenty of YouTube videos on the basics of how to use QuickBooks or, if you don’t want to learn it, hire out your bookkeeping and focus on your next real estate deal.  in either case, I’d recommend getting help setting it up properly (bookkeeper, CPA). 

P.S. You can relabel the terminology from Customers to Tenants, for example. 

Originally posted by @David S. :

@Shane H.  and @Michelle B.   

I agree that QB is a powerful program for accounting. However, there is a big learning curve. For example, the terminology is completely different. You don't have tenants or expenses, it is called something else. Also, QBO is different from the desktop version, so any step by steps for desktop useless when using QBO.

Shane and Michelle, do you have any sources or information that is available on Landords using QBO properly?

The functionality and idea behind QB Desktop and QBO should be the same, however, the layout and some terminologies are different. If you are able to find resources on how to set it up in QB desktop, then you should be able to mirror it in QBO (ie. setup address as a customer, property as class, setup recurring invoices, track 1099, etc.). 

By the way, in QBO, you can actually change the customer label to "tenant" (go to gear, Company settings, under Company tab, look for customer label) to make it more appropriate to your business. QBO is gaining its popularity for REI so eventually, you will find online tutorials specific to the industry in the near future.

Here are some screen shots of how I CUSTOMIZED QuickBooks that worked for me.  Double click on the screen shot to see it in a larger form. 

Also do a CTRL plus the + key to expand it even larger.

The Above is the Tenant Ledger.  To the Left is the list of properties and the Tenants who live there.  To the Right is the information regarding the Tenant's History.  Payments, Security Deposits, Late Fees, Bounced Checks, whatever involves this tenant will show up on the right hand side.  You have a contacts tab, To Do Tab, Notes Tab, and A correspondence Tab.  All at your fingertips.  Quickly accessible. 

The Screen shot below is in your Fixed Asset Items List:  This is where you can customize QuickBooks to show you everything you want to know about this property.  

We can see the Address, the Purchase Price, Land Description, Etc. 

In the screen shot below you will see where I further Customized this form to show me the 

*Year it was built

*Square Feet

* When the new furnace was installed

*When a New Water Heater was installed

*New Carpeting

(All these screenshots are demo files not my real files)

Now we get to Customize our Templates.  Invoices we send our tenants, When we receive a Security Deposit, Pet Deposit, Late Fees, Etc. 

We can add a photo, a logo, color, anything you want you can add it to this form.  You can make the entire form Blue, or any color you wish.  The world is yours when it comes to QuickBooks. 

Notice on these forms that I CUSTOMIZED IT TO ALWAYS show their 

*Move In Date

*Security Deposit

*Current Rent

*Lease Expiration Date

The Same thing with the Pet Deposit Receipt

Security Deposit

TENANT BILLING INVOICE   

This is just a little bit of what QuickBooks can do for you.  

It just doesn't get any better than that.

Nancy Neville

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