All Forum Posts by: Soh Tanaka

There is no "this is the way" actually. If you want (not that I am suggesting,) the owner can receive the rent, and you can charge the management fee to the owner, technically. Once upon a time, I was looking for a broker to work, and the head of the broker wanted to do the above way, and when I suggested for the broker to collect the rent, take the fee and pay the rest to the owner, he looked at me like I have 3 heads. I think the reason why he does want the owner to receive the rent was that he did not want to deal with holding "other people's money" if that makes sense. At least in IL, it's more regulated to hold other people's money.

The way my brokerage does is to collect the rent, take fees out, and then pay the owner the balance.  

Some property management companies charge different fees to the tenants and/or the owners also, and that may potentially become a good source of income, as long as you are competitive. 

Best wishes to you with the new company.

I'm glad to see so many other people are investing in Gary! I invest there also, and so far so good. @Ryan Shoe I don't know the exact rate, but I would double-check the property tax rate. It should be an easy online search. One of the benefits of owning a rental property in Gary is the fact that the property tax is LOW.

@Basit Siddiqi QuickBooks Desktop is no longer $200 for 3 years. It became a yearly subscription software, starting in 2022. It's still the best option in my opinion, as it's still much cheaper than the online version if you have multiple properties and/or LLCs, and also pretty much every accountant knows about the software. 

Try Olson Property Services.

In my opinion, keeping track of your rentals have 2 purposes. One is to know how your rentals are performing, and another reason is for tax returns. Assuming you use an accountant, pretty much every accountant will be able to use QuickBooks, so for that reason, I like QuickBooks. It's not intuitive to use it for keeping track of rentals, so you have to put some time to learn it. FYI, I used to use Excel also.

I'm not an accountant, but my accountant is pleased with how I do it. 

You need to set up an "Other Asset Account." Enter all the transactions that happen within the property management company there (such as receiving rent, taking the management fee, paying for repairs, etc.) The single deposit ("owner draw") can be recorded as a deposit from the "Other Asset Account" to your bank account. This way, you have all the transactions recorded per the property, and also the actual bank transactions match the QB (or other accounting software) transactions. 

To separate properties, you can use "class." 

I use QuickBooks even though some of my rentals are managed by property managers. This way, I don't have to look at multiple reports but have everything in one place. Also, reports from PMs don't include a lot of things like insurance payment, property tax, mortgage payment, etc.  

It sounds within reason to me. Just remember how little rate affects you for a loan size like that. If the loan amount is $75k, you only save $22/m by going with a lender who can do for 4%, instead of 4.5%.

Generally speaking, the further you live from your rental(s), the more benefits you may get by hiring a good property manager. Or the more rentals you have, the more benefits you may get by hiring a good property manager. 

That said, I know someone who personally manages a lot of units out of state. I also know someone who has one unit nearby and still hires a property manager. 

Also, consider not just your time but the amount of work you have to put into your continuing education.