Rental Accounting Should be Easy

It's not rocket science.

That's how the old saying goes, but sometimes it feels that way.

My real estate empire is pretty modest. My wife and I own a small apartment building with 14 units that we manage ourselves. She is in charge of the tenants and I am in charge of doing the maintenance and bookkeeping. I put together an Excel spreadsheet to keep track of all the money coming in and going out. Seems pretty straight forward, right? Well, it started out that way, but rapidly became pretty complex.

To start with, I wanted to know income and expenses on a per unit basis. That meant a tab for each unit. I also needed a tab to keep track of things for the overall building. There was a coin operated laundry in the basement that produced it’s own income and we needed to track expenses for the common areas. So there was another tab. We set up an LLC to run this business, and it has it’s own expenses like lawyers fees, printer paper, etc. So there was another tab. I wanted a summary of the whole business where I could see an overall view of the financial performance. So there was another tab. Each tab had multiple links back to other tabs. Add in tabs for personally paid expenses, the Home Depot card, capital contributions and draws, and a bunch of other things. I soon realized I had created a monster! Tabs as far as the eye can see…..

The worst part was when the year changed and I had to set it all up again for the new year and make sure all the formulas and links were right. Nightmare!

Here was my problem. I was spending too much time managing my spreadsheet and not enough time managing my real estate business. Real estate is not our full time job, so we had to do all this in the evenings and on weekends. There were also times when the spreadsheet had an error and I didn’t know it. I’d spend hours trying to figure out why things didn’t add up only to eventually realize I had a formula wrong on tab 16 in the spreadsheet. Who has time for that?

I started looking for a better solution. I had previous experience with Quickbooks, but it’s not easy to use in general and is not built for a real estate business. I thought surely there has to be a company out there that has solved this problem for small, part time landlords. Nope. There are companies out there that have this kind of product, but they are selling to large property management companies and they have expensive price tags. There was nothing built for me, the small, part time landlord. So I decided to build it myself.

I’m proud to offer you alcalo. The first rental bookkeeping software designed for small to medium landlords that self-manage their properties. alcalo is not a Swiss Army knife. It won’t do some of the things the more expensive options out there do, but what it will do is make tracking the financial side of your rental business easy and accurate. And it will do this at an affordable price. For most, it will be free.

Check it out and let me know what you think.

I will use this space to publish a lot more on various topics for small landlords.  You can check out my personal blog at www.rentmoney.biz.