There are several key factors that contribute to working as a successful rental property manager. While some rental property managers look after a handful of buildings, others take care of a large network of tenants. Regardless of the size of your organization, efficiently tracking expenses is a critical contribution to financial success.
Property rental managers around the world have a few skills in common. Most boast refined communication skills, are excellent at organizing, have a base understanding of legal agreements, and know how to manage conflict. With so much attention being placed on these skills, it’s easy to neglect expense tracking. Considering the value of streamlined expense tracking, it’s worth incorporating a routine. To help, Ken Burrows of Mortgages for America shares some deep insight into how to track your expenses like a boss.
What Rental Property Expenses Should Be Tracked?
If you want to make the most of tracking business expenses, then it’s important to consider every penny. Making an effort to accurately track expenses can offer several benefits. Consider the following as a starting point.
- Use a site like ZenBusiness to register your Nevada LLC.
- Prepare your organization for the annual tax season.
- Improve cash flow on a daily basis.
- Enhance skills as a responsible money manager.
- Increase employee satisfaction.
- Improve the accuracy of business expense forecasting.
Tracking all expenses is an effective way to reap all of the above benefits, and is part and parcel of your financial framework. But which expenses are worth tracking? As a rental property manager, your expenses will be varied, and not always clear-cut. The following expenses should be included in your budget:
- Administration fees – including the set up of the client account and the cost involved with inspecting the property.
- Time expense – which covers the various offerings of the service, including evictions, management fees, and vacancies.
- Transportation costs – as you move between multiple properties and your home
- Advertising costs – including efforts made to attract new customers.
- Operational equipment – that helps you conduct your daily work, including telecommunications and laptops.
- Maintenance – including routine maintenance and repairs.
When structuring your fees, make sure that you consider your client and their property. Key factors that will impact your fees include the size, type, condition, and location of the property. If you’re still uncertain about what to charge potential clients, then you can assess what competitors are charging.
How to Track Expenses
Now that you understand the benefits of tracking expenses, it’s important to learn the best way to do so. There are a few ways of improving the efficiency of tracking expenses. For example:
- Open a business account.
- Pay for all business expenses with a dedicated business card.
- Use a mobile scanning app to digitize receipts.
- Refer back to your existing budget and assess how the expenses fit in.
- Research accounting software options, especially one that links to your business account.
QuickBooks Online Advanced is a robust system that offers a range of services. Not only does the software allow users to connect with various bank and Paypal accounts, but it also tracks and saves receipts. Essentially, you can use an expense tracker that also lets you sort expenses and receivables into specific tax categories, making it a lot easier to prepare for tax season, as well as to simply collect invoices and pay your bills.
Where Can Rental Property Managers Save Money?
Once you identify your expenses, it becomes easier to save money and cut back costs. There are several adjustments that can be made, and here are a few to start:
- Make an effort to reduce utility bills. Some methods include installing LED lighting and insulating hot water pipes.
- Charge high-use tenants for their utility costs.
- Outsource maintenance work instead of paying for a full-time handyman
- Leverage the potential of deductibles.
Streamlining expenses is a small adjustment to daily management that can make a big difference in profit. Taking advantage of various software solutions can be a saving grace during a busy day.