All Forum Posts by: Sterling Fields

@Dassi Lazar Yes I am in the same position! Using excel and my free landlord software to track everything is making me very uneasy. So you actually hired an employee(1099 I am guessing)? I haven't even thought of that. How is it working out? I assumed it would be an accounting firm or online source. 

@Ryan Daniher While that sounds like a great plan, and yes it would probably be more economical, i would assume that i would need a decent amount of accounting knowledge to keep them in check? I would be lost in knowing if they were doing the work correctly or not; although come to think of it, it would be that way with anyone. I need to look into this deeper because i have ZERO experience with VAs. I do like the idea in theory though. Any suggestions for the best place to learn about utilizing VAs?

@Dan V. Great advice! The number is definitely higher in an acquisition month than when it is stabilized. I do believe a 12 month average would be a good estimate for the bookkeeper. Thank you!

Agree with Simon. If you can, I would vote to put a down-payment on a Duplex and house-hack. Huge savings over paying rent, plus you will own a rental once you decide to move out. 

 Simon, I am leaning towards your advice to let the professionals do their job and let me continue looking for deals. Having a strong real-estate focused CPA on your team is an absolute must. My CPA last year was not real-estate specific and i wanted to beat my head against the wall when i started explaining to him some of the deductions that were available to me as an investor. That will NEVER happen again. So the next question is what should a competent bookkeeper run me for just 11 units? My fear is that the RIGHT bookkeeper will cost me half of my yearly profits, causing my growth to stagnant. In which case, i should just suck it up and keep the books myself until my portfolio grows large enough to support the right person for the job. 

 Gabe, thanks for the feedback! Kitt looks like an awesome software! However, my question is the same one that i asked Joel above: Will this software be able to track activities outside of operating expenses? Maybe this is a bad question because i am not a CPA and don't understand that most software CAN do this; but working for CPAs, i know that accounting can be very particular, detailed, and tricky when it comes to the "everything else" outside of normal operating revenue and expenses (refinance, capital gains, investing activities, etc.). My thought was that outsourcing this to an accountant would relieve myself from the headache of trying to figure all of that out. Just because i have the tools in front of my doesn't mean that i will be able to understand how to use them.  

Thanks for your input Joel! Me being a multi-family financial analyst, i am a little anal about expenses. So i am not too worried about digging into the data each month and asking questions. Plus my thought is that i would be sending all of the information to the book-keeper anyways?

I will definitely look into getledgers.com. However, i do have a few reservations about using an online software like that one. Correct me if i am wrong, but my feeling is that it won't be able to help me with certain calculations (i.e. depreciation if i have a basis increase, or interest expense if i have a refinance), or keep up with the balance sheet and cash flow statements. Is there somewhere i can track cash flow from non-operating activities? (i.e. cash-out refinance of a property, putting down-payment on a new property).

You took the words right out of my mouth. That's exactly how i feel in terms of long term growth. It's hard to start acquiring team-members when you are so early in your investing career. Paying people to do other jobs when there isn't a ton of money to go around to begin with. I guess i should have posed my question another way: Is bookkeeping something that should be hired out this early in my investing career? It is the long term plan for sure; but is 9 units enough of a scale to pay someone for this position yet? I guess it's a pretty important role so i would assume yes? Thank you for your feedback!

@Gita Faust I do feel like my time would be better spent growing my business; i am much better at the long term planning aspect than the day to day record keeping. I agree with you completely on the fact that if you put your mind to learning something it can absolutely be accomplished. I will definitely make it a point to find a bookkeeper that takes into account everything outside of the bank statement. Also, thanks for the Quickbooks tip. (shows you how much i know about the subject area:) ) Thank you so much for your feedback!

Hello fellow BP members! Looking for a little advice..

Little background: I am a financial analyst for a multifamily developer, so i understand real estate and all of the financials associated, but i am definitely not accountant. I currently own 7 rentals, with 2 more under contract; all are self-managed through Cozy.co.  

I am very quickly realizing that if I do not get a serious grip on this whole weekly/monthly bookkeeping thing, it could get out hand. I want to treat the properties as a business, like they should be treated(and generally do in all other areas), with weekly bookkeeping and monthly/yearly reports. 

My question is: Should I spend the time to learn an accounting software like Quicken, as well as the time imputing information weekly and keep the "books" myself? Or outsource this task to an actual bookkeeper and keep my energy focused on other aspects of the business? And also, should the bookkeeper be an online service or local firm?

My goal is to acquire another 10 units next year, and so on etc., etc. I don't plan on stopping the acquisition train anytime soon.

Any advice from investors who have faced this dilemma? What was your solution, and how did it pan-out?

Thank you so much in advance for any advice/insight!