For LL's that manage their own properties-- what do you use to handle finances?

[Jade Davis]

Hi fellow BP'ers!

After much hemming and hawing about it, I decided that I would like to manage our first property on my own in the beginning rather than hire a property manager from the get-go. I want to at least know what goes into it and what I'm looking for from managing the property before I outsource that to some professionaly company.

But I started thinking... what does everyone use for finances? How do you let your tenants pay their rent (if they pay online) and what does that service cost you (if you use a service)? Do you use an excel sheet to keep track of all of your expenses, cash flow in and out etc. or an online service or a book keeper and again, what is the cost associated with your system? I am just trying to learn a bit about what everyone does so I can find my own system!!

Also, please share what type of property it is that you have so I know. And if you use a property manager/management company, please share how you feel about how they handle your finances. TIA!

[Account Closed]

Customer/Jobs vs Classes:

Aah that is the question!   

Classes are a Landlord's very best friend.  

CLASSES

The Class feature in QuickBooks, will give the landlord a detailed accounting of income per rental building, per rental unit,  per county, city, you name it, and QuickBooks will do it. 

Not only will the Class feature tell the landlord how much income they made per property, but will also tell them how much money they spent in expenses, per building, per unit, per county, per city, etc., and will subtract those expenses from the income and give you you're bottom line.    (I'm panting with excitement because I know what it can do and what it can do for you)

If you are in the red, you will know whether to sell that property or not.  If you are in the black, you will whistle all the way to the bank.

When you go to court and a tenant does damages to your rental, you will have an itemized list of all costs that you spent on damages because you have assigned those damages, those costs, to the rental property listed as a class. 

customer/jobs

QuickBooks was designed in the beginning for industry who sold things.  Builders who built things.  Therefore the word Jobs.   You had a customer and then you had a job you were doing for that customer.

In our Industry we will customize it to fit us!!! So we will make our rental property the customer, and the tenant the Job.  

When you see words in QuickBooks like  sub account,  Subclass, and Job, they're just another word for Indenting, because QuickBooks does everything in outline form. It has headers and accounts, sub classes, and jobs, that are indented under the Header.

FOR EXAMPLE

Let's add a rental property as a Customer and the tenant as a job 

Customer:  1234 Money Maker Drive                 

                     Job:   Betty Spendalot (Tenant)

Customer:  5678  Bank Street Avenue

                  Job:   Conrad Savesalot

Everything is neat as a pin in QuickBooks. 

All you are doing is setting it up in outline form.

Let's take a look at the class feature to see how your properties will look there.

SETTING UP YOUR PROPERTIES AS A CLASS

1234 Money Maker Drive

5678 Bank Street Avenue

If you can use two fingers to type on your computer, you can use QuickBooks. 

You have just setup your properties as a class and Your Tenants as a Job (Indent) of the rental property.

When you invoice your tenants. you will choose the rental address from  the CLASS COLUMN on the invoice.  

When you pay for a repair on a rental property you will choose the CLASS COLUMN on the check stub.  

Any time you want to know where you stand financially on a property, just do a Profit and Loss Report by Class.  Voila, with a click of a button, you can see your income less expenses and your bottom line.

You can see just how much money you spent for that building or that unit inside the building, or that single family home, right down to the penny!  

Once you know the POWER OF QUICKBOOKS, I kid you not, it will knock the socks right off of you.

I had a customer write me and tell me that he had used QuickBooks for over 25 years and didn't know the Power of QuickBooks until I wrote him exactly what I am writing you.

For a little over $200 (and it's  a tax write off), you will have the best friend you can have in this business.

Nancy Neville

Certified QuickBooks Pro Advisor