All Forum Posts by: Matthew Banks

We have just 5 properties, but with turnover each year, it is very time-consuming to figure out security deposit refunds net of any deductions. We use a spreadsheet to track any deductions for issues caused by tenant damage. Then we also have to track water bills to ensure tenant reimburses us for paying them.

Is there an easier and more automated way to track and quickly tally the security deposit refund due to a tenant? We use baselane, so is there a simple process with accounting software that would make this easy?

Thanks!!!!

 Hey Jamie, good suggestion!! We're trying it now and so far, so good!

Is there a recommended option for washer/dryer that doesn't require coins/bills but instead takes phone pay or a card, so that both tenants and prop managers don't have to deal with coins and bills? Our tenants break our machines so often that we need to charge per use, but I would really prefer not to deal with coins and cash. Thanks!!!!!

We have several 1-2 family rentals in a neighborhood that gets a mix of students, grads, and professionals. The competitors all provide washers/dryers, some free and some coin-operated. We have washer/dryers as well, but are constantly having to do repairs. The tenants are likely over-stuffing them. I'd like to charge a per use fee to at least help recover the cost of repairs each year or buy new machines. I'd strongly prefer to have a cash-less payment mechanism though, ideally a phone or a card that you can add funds to with a credit card or phone, so that tenants aren't forced to use coins or cash bills. (It's a modern inconvenience to force tenants to get coins or bills from a bank, and then we're also stuck handling coins as well.) Anyone have recommendations for options? We have 2 pairs of washers/dryers that are currently coin operated that we could convert. And we have non-commercial machines in the other properties that I'd like to convert to a pay per-use. 

Thanks for the info in your post, but if someone has just 1-4 properties and they generate cash flow after expenses of only $500 or so/month, that is $24k/year in cash flow. Quickbooks pro is $1080/year, which means on just accounting software alone, someone is paying out 4% of their cash flow, not including the tax accountant or the bookkeeper's costs. To me that is not proportionate and accountants need to be sensitive to that with their small business/real estate clients and not recommend a one-size-fits-all solution. Every accountant I hear from says use Quickbooks, and that's a shame. 

That's why I'm looking at Baselane now (which is free), and possibley Quicken for Biz & Personal (which is $6/mo).

 Everyone recommends Quickbooks, yet it is not a one-size-fits-all solution esp. when its annual price can be $1000+. For very small businesses with just a couple properties, this isn't affordable. There are other solutions out there and I'd like to emphasize that people shouldn't jump to paying for a bookkeeping service that might cost 3% or more of their gross revenue.

There is Quicken for business and Waves accounting, and likely many other software programs. Accountants and larger property owners leap to Quickbooks because that is the preferred program that accountants know and use, and accountants I know generally prefer to avoid having to work with multiple accounting software suites, which is understandable, though a disservice to small firms. 

While a business owner's job is primarily to focus on revenue, you also have to make a basic effort to control expenses and keep things from eating up 1,2,3,4% or more of gross income. People say to hire a bookkeeper when you can afford it, and that implies you should also only pay for an expensive accounting suite when you can afford it.

If we have a Lowes business pro account, and in Month 1 we buy $1000 of materials for properties in 3 different LLCs, it sounds like manual effort is needed both to pay off the $1000 balance by making payments from each LLC's bank account for the amount it owes, and then a separate manual effort to record and assign the expense transactions in the bookkeeping software. Any way to eliminate one or more of these manual steps? We can't setup auto-pay because that wouldn't be able to withdrawl the correct amounts from each LLC bank account. Bookkeeping software would likely note that a transaction took place, and maybe it would be able to categorize it correctly, but maybe not.

Hi, we manage properties in a partnership and in a couple LLCs. We have Lowes and other accounts to purchase materials for repairs or renovations. Those expense accounts need to be paid with funds from the corresponding property and its bank account. Does anyone have a method or process that helps make this easy and quick to manage? We have a single Lowes Biz Pro credit account, for example. Do you group paper receipts into folders for each property/entity and then pay bills once a month, for example? Is there an easier, more automated process?

Thanks!

People are getting ripped off with HVAC furnace replacements and repairs. I hope this helps others:

HVAC systems are treated like black boxes by most property owners, and that is a BIG MISTAKE. They are often quite simple, have few parts, and can be easy to troubleshoot and even do some routine maintenance and minor repairs yourself.

I've had to deal with a couple furnace issues in the last year, in both cases a bad logic board was the cause, and we only discovered this after having multiple HVAC companies come out and assess the problem, struggle to find the root cause, often replace other parts unnecessarily, and ultimately shrug their shoulders and recommend a full replacement at $5k+.

In one case, I went online, bought a logic board and installed it myself to fix a furnace that wasn't working consistently. Cost to me: $100. Lowest price for logic board from local OEM provider: $500. Lowest quote from HVAC to replace logic board: $1000+. Quote to replace furnace $5k+ (with a strong suggestion to do so by HVAC). In a second case, a trustworthy HVAC rep replaced the logic board for us at <$400 price, which is very reasonable.

Furnaces are very expensive to replace, and I'm finding that HVAC companies will often jump to recommend replacement when it is not necessary, because replacements make them a lot of money. You want to make sure that it is necessary. Have the HVAC company explain what is wrong with your furnace, specifically which parts must be replaced and what the cost of each part is. You can quickly go online to confirm for yourself. You also want them to explain which parts are working fine so that you know they checked all the sensors, blower capacitor, blower motor, exhaust motor, and burner. 

A typical mid-efficiency HVAC furnace has two motors, a logic board, a blower capacitor, and several sensors. It also has a burner and a heat exchanger. While there are other parts, those are the main parts that tend to fail on mid-efficiency furnaces for example.

The sensors are cheap (<$20). The capacitor is cheap (<$100). The logic board is reasonably inexpensive if still made (<$200). If it isn't made, you can find used boards or universal boards. I bought a couple used boards for $40-100 each, the first didn't work but the second did. The motors are more expensive. The burners are a little more expensive as well. But as you can see none of these justify buying new, even if you have to replace several of them at once.

Furnaces should have an indicator that will guide you to the source of the problem, but there are times where it doesn't give you enough of an answer. That's when you need to be able to visually inspect and even test some of the parts to identify an issue (like the flame sensor or the ignitor). Visual inspection can identify a broken sensor. Testing a part with an electrical meter can also help identify whether it is still good.

It is reasonable to learn how to to check the sensors, capacitor and motors yourself if you are handy. A good HVAC company will also be able to test them one by one as well and verify each.

What remains is the logic board, which is hard to test thoroughly, and I find most companies can't do more than test some of the connections.

If you are having furnace issues, before letting an HVAC company talk you into replacing a furnace, consider the following:

1. if you have an ancient octopus furnace, don't replace it, get it repaired. We have one that is over 110 years old. All modern furnaces have <20 year life span, and that is according to HVAC technicians I've spoken with. Yes, it won't be efficient, but you'll have to ask whether efficiency is worth a fat purchase price, unreliability and short life-span.

2. if you have a modern furnace, mid-efficiency and high-efficiency are two of the main types. High-efficiency has more parts and is more expensive and may have a shorter lifespan, according to HVACs.

3. If you are having furnace issues, you can go through a check list to determine where the issue is. If you have an HVAC expert come to troubleshoot the furnace, ask them to identify the exact source of the problem as well as which parts are working fine. Make sure they actually test the various parts, usually with a simple voltmeter.

4. HVAC techs can't always determine that a logic board is at fault. They can identify only a few cases, but the boards are too complex. They are the true black box of a modern furnace. If they tell you that they don't know what is causing the problem with your furnace, but they can confidently tell you that all the other parts are working fine and testing well, then consider replacing the logic board. Just make sure you aren't being gouged on the price.

*While you can make many repairs yourself and do some basic maintenance - which can save you considerable money - but you still should have a pro company come and inspect/test your furnace regularly.*

I'm finding it a bit overwhelming to manage the documents with our handful of MTR/LTR properties. Insurance, tax, tenant info, leases, applications, listing/marketing docs, water, notices, repairs, logs of maintenance and tenant damage, etc. I get a number of physical docs but also have many other docs in digital format. 

I have a physical folder for each property and year (purchase/closing, insurance docs, ...).

I have a digital folder for each property, a tenant folder for the tenant(s) of each property.

A digital general property management folder with applications, leases, marketing, etc.

I'm trying to use sheets to log repairs/maintenance/ToDo

Scanning every doc into digital would seem like a huge waste of time, so I imagine I need to keep physical files.

Anyone have a better system for managing physical/digital docs?

Love to hear what works for others.

Thanks!!!