Accounting – Propertyware

Budgeting Post-Pandemic: How to Forecast With the Numbers You Have Now

Jake Belding — Thu, 11 Nov 2021 13:07:02 +0000

By: Laurie Mega It’s so easy to get caught up in the everyday logistics of property management. Focusing on rent and fee collection, marketing to attract tenants, and communication with owners can take the spotlight off the health of your core asset: your business. “At the end of the day, if you’re the CEO of a property management business, your number one job is to own the financial outcome of the business,” says Daniel Craig, CEO of ProfitCoach and lead author of the NARPM Accounting Standards. After the uncertainty of, well, everything during the pandemic, property managers are keeping a closer eye on their budgets and using them to set tighter goals for the future. Going through a proper forecasting process is an essential part of that process. Forecasting helps you own the financial future of your business and justify your business decisions. It makes it easier for you to move from a reactive to a proactive position, which has proven to be particularly valuable since the pandemic. By planning for worst-case scenarios, your business can bounce back from setbacks faster. Forecasting can help property management businesses get on a stable growth track. Given the anomalous nature of the last two years, however, you may be at a loss as to how to put together a reliable forecast. After all, how can you base your future plans on numbers and situations that were out of the ordinary? By using a simple forecasting method that combines pre-pandemic numbers with current market analysis, property managers can forecast for 2022, no matter what their goals are. They can then set targets and create a monthly plan to hit them. Here’s how:

Use a Simple Framework

First and foremost, don’t over-complicate the forecasting process. Choose a simple, flexible framework that allows you to build out your forecasts quickly. “If it isn’t simple, then chances are you’re not going to do it, or you’re not going to do it well,” says Craig. Use that framework to create a monthly forecast that takes seasonality into consideration. For example, if your properties are located in college towns, rental occupancy will most likely be at its highest beginning in August. This may also be the month with the highest turnover or lease-renewal rates. Take all of that into account in your forecast. If things change unexpectedly, a simple, flexible framework will allow you to go in and re-forecast quickly. If the pandemic taught us anything, it’s that things can change in a matter of days. Your forecast should be agile enough to change, as well, to keep your business running on accurate numbers, goals, and predictions.

Look at Non-Financial Growth Over Many Years

To forecast your financial growth you, of course, need to look back at the non-financial growth (or quantitative growth that’s not measured in money) of your company over several years. Take into account not only the anomaly that was 2020 and 2021, but previous years, as well, to get a full picture of your growth as a company. You may not have added many doors in 2020, but instead saw a steady door count. You may have also seen a lag in rental payments, but, like other property managers we talked to, your turnover rate and new lease counts most likely remained low as tenants stayed put during the pandemic. But how did your growth during the pandemic compare to previous years? Were you adding doors at a steady rate? What was your turnover rate then, and how quickly were you attracting new tenants? The right software platform can help you answer these questions. Dive into your custom reports to look at your growth, YoY, before the pandemic and then compare it to your numbers during the pandemic. Then ask yourself questions to better understand your growth. These should include:

Can you attribute change in growth to the pandemic?
If not, or at least not entirely, then else might have been at play?
Previous to those years, how many doors had you added, YoY?
How many doors, if any, would you have to add in the coming year to recover your previous growth rate?

From there, analyze the market to get an understanding of how the rental market is faring in your area. According to ApartmentList, rents rose steadily this year, first recovering from the pandemic and then surpassing pre-pandemic trends. What are rental rates doing in your markets as tenants shift to a post-pandemic world? And now that eviction moratoria are ending, what will that mean for the growth of your properties? Take all of this into account as you create your budgeting forecast.

Look at Year-Over-Year Numbers Before Making Big Leaps

The coming year may be a recovery year for your property management business, where budget forecasting reflects more modest goals that get you back on track. In that case, look over YoY numbers to measure growth both before and during the pandemic, then base your forecasting on that. Many property managers, however, didn’t experience a dip in business during the pandemic, particularly those who manage single-family homes. For those managers, 2022 may seem like the perfect time to set some aggressive goals. Still, those goals should be justified by either market research or by YoY analysis. “If you’re going to deviate from past performance,” says Craig, “you should have a detailed, realistic plan that articulates a justification for that deviation.” Either way, dig into your budget management software and look at your numbers. Analyzing how well you stayed within budgets in past years will help you determine whether or not your goals should be audacious or more reserved for the coming year.

Use Multiple Scenarios

Of course, everyone likes to forecast and plan for a successful year, but it’s important to play out downside scenarios as well. Craig’s team builds out a model for their clients that accounts for possible delinquencies— something many property managers had to deal with in the last two years—as well as changes in rent prices and other situations that might affect your bottom line negatively. “A plan B helps you understand and have some concrete awareness around what kind of expenses you might have to cut to survive a negative scenario,” he says.

Evaluate Past Commitments to Set Future Commitments

According to Craig, how well or how poorly past years have played out depend on a firm’s commitment to its goals. He encourages clients to look back on previous years to determine whether or not their teams truly shifted their priorities to meet prior goals. Again, you can use property management software with custom reports and a dashboard to maintain a clear picture of goals and commitments. Let’s say your goal in 2019 was to decrease maintenance’s time on site for each job, while still collecting the minimum one-hour fee, to increase profitability. You can use your reports not only to see how much time maintenance logged on each job, but whether or not job proper staffing and resources were available. Craig acknowledges, of course, that there are years where unexpected events derail a company’s goals, 2020 being one of those years. But, in general, he encourages property managers to look back on their goals, their commitments, and actual outcomes. Why is this helpful for forecasting future performance? “Because it brings clarity,” he explains. “If you’re thinking about adding 100 doors, what do your commitments really need to be and where do you need to see a shift in your commitments?”

Track Variances Between Forecast and Actual

Tracking variance is important not only for identifying issues, but also for setting realistic goals. Recently, Craig notes that he’s seen property managers tracking YoY variances more closely. Property managers most likely saw increased variance last year and the year before, as late and other regularly collected fees fell off. Take a look at your accounting reports and compare them to your forecasted goals for years past. If you’ve integrated your accounting software with your property management software, you can compare financials with logistics such as time on site for maintenance, rental delinquencies and late fees, and owner payments. As you progress through the year, use those tracked variances to refine your budget forecasting goals. If your variances are high, you can find places to scale back on more aggressive goals, for example. Forecasting for the next year may seem like a heady task given the uncertainty we’re becoming so familiar with. If you use only the numbers from the past few years, you’ll most certainly come out with an inaccurate budgeting forecast, and the same is true if you ignore the period of the pandemic altogether. By looking into your custom reports and making full use of integrated accounting software, you can combine data from fiscal years both before and during the pandemic. A forecast built on this strong foundation will serve your property management company far into the future and help you deal with the uncertainty that any year can bring.

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Tax Season Preparation: Top FAQ’s about 1099 Forms

Michael Cunningham — Wed, 23 Dec 2020 13:00:06 +0000

Form 1099-NEC is due on or before February 1, 2021, whether it is paper or electronically filed. Form 1099-MISC must be filed by March 1, 2021, for paper filers, or March 31^st if you are filing electronically. There are various types of 1099, but for property managers Propertyware has allowed you to print Form 1099-MISC. For the 2020 tax year, the 1099-MISC is only used for Owner 1099s. The IRS has introduced a new Form 1099-NEC to report nonemployee compensation for Vendor 1099s. Its primary purpose is to show the amount you’ve paid to owners and contractors or service providers over the course of the year, so the IRS can match the income they report to the total amount reported by companies that paid them. You submit one copy of the form to the IRS and another to the owner or vendor. Your Propertyware software can populate these forms for you, potentially saving you a great deal of time during tax season. Check out the top four questions about how to correctly complete your 1099’s! Then download a full list of FAQs.

1. Where in Propertyware can I print my 1099’s?

1099’s are available for print in Propertyware: Vendor 1099’s

Money Out > Related Activities > Print Vendor 1099’s / Print Vendor 1096

Owner 1099’s

Management > Related Activities > Print Owner 1099’s / Print Owner 1096

Get more information about generating 1099’s in Propertyware.

2. With a new 1099-NEC form, does that mean I need to order two different forms to print?

Yes. Propertyware will print the correct data on the IRS form in the proper placement on the form but it will require that you purchase both the 1099-MISC and the 1099-NEC to be loaded into your printer.

3. Can I file my 1099s electronically?

You can generate a 1099 eFile Export and save it to your computer. Then submit the saved filed outside Propertyware to the IRS. This functionality is available under Money out and Management. Electronic filing is required if you have 250 or more 1099 forms to report but you can file electronically even with fewer 1099 forms. Vendor 1099’s

Money Out > Related Activities > Print Vendor 1099’s

Owner 1099’s

Management > Related Activities > Print Owner 1099’s

Important: Clicking the Generate 1099 EFILE Export button does not automatically send the file to the IRS. It must be saved to your computer and submitted outside of Propertyware to the IRS. Propertyware provides the necessary file to complete electronic filing for your vendors and owners. Get more information on 1099 e-filing. Check out other helpful tips from the IRS.

4. What reports can I run to validate my 1099’s?

In Propertyware you can review various reports for monies paid: Finance Reports

Owner 1099s – 1099 reports can also be a quick view to see if a Tax ID number, mailing address or other specific contact info is missing.
Vendor 1099s
Money Out – Bill Payments
Money Out – Checks

Financial Statements Reports

General Ledger report – Filter out any accounts that are set to “Exclude From 1099” but be sure to include discount and adjustments.

You can also go to Money Out and review the Vendor Ledger for payments made during the calendar year. For owners, remember that it is what was actually earned during the tax year and not what was paid out in owner draws that must be reported.

For a full list of 1099 FAQ’s,

Download this Free Guide!

**Please note that this blog article, and its contents, is being provided for informational purposes only. It does not constitute legal, tax or accounting advice and should not be used or relied upon as a substitute for such advice. You should consult with a qualified professional for any legal, tax or accounting-related questions you have relating to the subject matter.**

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6 Pro Tips for Property Managers to Get More From Their Taxes

pwadmin — Wed, 07 Mar 2018 09:00:21 +0000

One of the benefits of owning and managing properties is the ability to leverage your taxes as a property owner. If you’re not an accountant, however, it can be more daunting than exciting—especially if you don’t know what you can deduct, or how to best position yourself and your income. We’ve talked with a variety of professionals in the fields of property management, tax laws, and accounting to bring you their best tips for getting the most from your taxes.

1. Don’t forget to deduct repair costs

“If you pay a repairman or other person $600 or more during the year to perform services for a client’s property, you must separately report those payments to the IRS.” —Stephen Fishman, Tax expert, attorney, and author

2. Claim your home office

“You may not consider your rental income to be a business with a regular office, but it is. You have to record your income and expenses somewhere and that is likely to be your desk or a room in your home. If you use a room or other dedicated space in your home exclusively for your rental activities you can claim a portion of your house expenses as a deduction against your rental revenues.” —TurboTax, Intuit.com

3. Add additional revenue streams where possible

“In multi-family properties, look for the opportunity to add services like coin-operated laundry and vending machines, which will not only provide revenue but will add resale value by raising the property’s return on asset value, or capitalization rate. In single-family homes, offer extra house cleaning and landscaping services to tenants when they sign the lease. They may be happy to pay extra to avoid responsibilities they’d otherwise take on. You can negotiate the rates of independent landscaping and cleaning services, contract them out, and collect a fee as the contractor. For instance, if a cleaner agrees on a $75/month fee, you may offer the service to your tenant for $85/month, increasing your annual revenue by $120.” —Blake Hilgemann, Property Manager and contributor to BiggerPockets.com

4. Use rental losses to your benefit

“If a taxpayer is an ‘active participant’ in a real estate activity, they can normally use up to $25,000 of rental losses to offset other sources of income. Unfortunately, if a taxpayer’s Modified Adjusted Gross Income (MAGI) exceeds $100,000 those losses begin to be reduced and at $150,000 are phased out completely. Essentially, you can use rental losses to reduce your ordinary income unless you start making too much money. One interesting exception to this is if you are a real estate professional. In those cases, the entirety of rental losses can be used against ordinary income—regardless of income level. There are other considerations, but the two main requirements are that:

More than one half of your personal services performed across all businesses and activities are performed in real estate trades or businesses
More than 750 hours of services are performed in real estate property trades or businesses in which the taxpayer materially participates

As with anything tax related, who exactly qualifies would vary on a case-by-case basis, but property management companies would be in a very good position to qualify as real estate professionals for the purpose of this deduction.” —Micah Fraim, CPA and best-selling Amazon author

5. Minimize tax liability when you file

“Whether you’re running a property management business full-time or are a realtor who’s working as a property manager on the side, you can take steps to minimize your tax liability as a Schedule-C filer. [For example] track your mileage for every site visit and errand that you complete, which includes making bank deposits, buying office supplies, driving to the post office, affixing for rent signs, showing apartments, and attending meetings.” —Thomas J. Williams, EA, Tax Accountant & Owner of Your Small Biz Accountant, LLC

6. Join the landlords’ association in your area

“Joining an association will provide you with a wealth of experience as well as sample leases, copies of laws and regulations, and lists of decent lawyers, contractors and inspectors. Some associations may even allow you to join before you buy a rental property.” —Andrew Beattie, Investopedia Jessica Thiefels has been writing and editing for more than 10 years and is now a professional freelancer and consultant. She’s worked with a variety of real estate clients and publishers, and has been featured on Forbes and Market Watch. She’s also an author for Inman, House Hunt Network, Homes.com and more.

The post 6 Pro Tips for Property Managers to Get More From Their Taxes appeared first on Propertyware.

The Best Accounting Tools for Rental Property Managers

pwadmin — Fri, 09 Feb 2018 23:09:39 +0000

When the topic of real estate investing and property management comes up, people are usually interested in house flipping, advertising vacancies, maintenance and evictions. The less discussed but extremely important topic is accounting! Real estate investors and property managers need to use efficient, organized accounting systems. There must be a solid system in place for revenue coming in and out, reporting and tax preparation before a rental property is available for rent, rent checks are deposited and maintenance requests are addressed. Some of the tools used at Nexus Property Management Franchises help with efficiency and organization in all of these areas. Property management companies and real estate investors are looking to receive a return on their invested time and money. They must be able to handle, document and organize revenue that has come in. Propertyware allows Nexus to organize all payments, bills, owner statements and tenant ledgers easily in one location. It also offers online and cash payment options for tenants, in addition to direct deposit payments for vendors and owners. These tools simplify the task of managing hundreds of owner accounts and thousands of different tenant ledgers. Most people are happy to handle money coming in and less enthusiastic about tracking money going out. A good rule of thumb is to keep the minimum number of bank accounts and credit cards to be able to track expenses for your real estate investments. A comprehensive property management software like Propertyware will assist with tracking vendor payments and similar expenses with its built-in general ledger system and check printing. In addition, there are other expenses involved when using charge cards, subscriptions, etc. For these types of transactions, Nexus uses a single American Express account and syncs it with a business bank account on QuickBooks online. This allows for easy expense tracking and increased automation as common transactions are labeled. At the end of the year, Uncle Sam will be interested in the profit remaining after all of the money collected is offset with expenses paid. For Nexus Property accountants, reporting and filing taxes is a very organized and straightfroward process due to the efficiency of Propertyware, and automated expense tracking. Nexus Property Management takes additional security measures by using cloud storage and retaining scanned copies of all check stubs and relevant tax documents. In the event of a computer failure, taking additional steps to backup information can prevent loss of data. It also provides ease of access to your information from anywhere. Nick D’Agnillo is the CEO & Founder of Nexus Property Management, A National Property Management Franchise with offices in Pawtucket, RI, Fall River, MA, and Destin, FL. D’Agnillo’s company manages all types of rental property—from single family homes or condos to large apartment buildings and complexes.

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Preparing for the Busy Tax Season in Single Family

pwadmin — Fri, 08 Dec 2017 22:28:05 +0000

With tax season approaching, we interviewed Nicholas D’Agnillo, owner of Nexus Property Management, to get some tips on how owners can prepare in advance so as not to be swamped when the filing date is bearing down fast. “Advance preparation is so critical that we won’t officially take on new owners until they’ve given us their W-9s and contact information so we can get their tax information to them reliably when the time comes,” D’Agnillo says. “It’s a bad idea to wait until the deadline is on top of you. You should be assembling the information your accountant will need ahead of time.” D’Agnillo says that Propertyware has capabilities built in to record and easily transmit tax-related information to owners. “The software publishes a monthly report to the owner portal in case owners need to see interim numbers, and then produces a year-end report which we send to all the owners that’s ready for them and their accountants to use,” he explains. Other tips from D’Agnillo include: 1. Set up “pro” accounts with Home Depot and other vendors so data is collected on property-related expenditures 2. Maintain separate business accounts for each property rather than lumping them together 3. Use credit cards, debit cards or checks rather than cash to pay for property-related goods and services, making it easier to keep records “If you don’t have software such as Propertyware that keeps up with tax-related information, I’d suggest something like QuickBooks,” D’Agnillo says. “But of course it’s not tied into the bank and there’s no integration with the rest of your software, so your rental income information won’t flow right into your monthly and year-end report – there’s more manual work to do. I’m a Propertyware fan so of course I think it’s the best way to go not just for keeping up with taxes but for running the whole business.” Nexus Property Management provides property management and investment realty services in Rhode Island and southeastern Massachusetts.

The post Preparing for the Busy Tax Season in Single Family appeared first on Propertyware.

7 Rental Property Management Accounting Tips and Tricks

Marc Eiting — Fri, 06 Oct 2017 10:00:47 +0000

Managing rental properties goes far beyond repairing leaky taps or finding new renters. You need to manage your finances well when you’re involved in the complex business of rental property management. And for this to happen, it’s important to maintain accounting processes that support your business development. 1. Create a spend management program Creating a spend management program provides the infrastructure behind your spending decisions. You create a corporate spending policy and employees report back on their spending, making it more visible. By talking about your spending decisions, you establish controls on spending that can lead to tighter business spending and more savvy purchasing decisions. 2. Standardize your spending If every purchase involves extensive discussion, you may be wasting time and money. Develop a list of preferred vendors and products that your employees know and trust. By planning for the small stuff, you avoid spending large amounts of time on small decisions such as what fridge to buy. Instead, you’ve done your homework and you know the particular unit is energy efficient, low maintenance, and available at a cost that you can afford. 3. Choose cash or accrual While larger management companies generally use an accrual method of accounting, recording income and expenses when they occur, it can be helpful to smaller companies to use a cash accounting method. With the cash accounting method, you log expenses and income when it comes into your account. This helps you see what’s actually in your account when you’re starting out and have a smaller cash flow. However, it can be challenging to monitor data over time, for example, when you log July’s payment as June because it was deposited on June 30th. Determine which method is best for your business. 4. Don’t forget to forecast Like the weather, your income and expenses can be hard to forecast. That being said, forecasting is an essential part of your plan to mitigate risk. Understanding what today’s trends could mean for tomorrow’s income and expenses will allow you to identify potential problems before they arise. 5. Plan for the seasons If your business waxes and wanes with the seasons, remember to account for this when you’re making plans. This will impact your budget forecasting, since you can’t count on a consistent income, and it can be something you incorporate into your long range planning year after year. 6. Share and access data Within a property management business, there are often several people who are focused on accounting. Make sure accounting reports and data are available through software that makes them accessible and easy to share. This allows everyone to easily access their budget or make plans for the future without constantly interrupting those who manage your accounts. 7. Go digital Buried in piles of paper? In the digital world, you can store that data without using reams of paper. From scanning your receipts to online banking, using less paper is not only environmentally friendly, it clears your desk and makes it simpler to find and share the information that you need. When you’re trying to get on top of your rental property management, you need to make sure that you focus on your accounting. Tracking your accounts with property management software can help you understand where past problems have occurred and where you can make progress toward a stable financial future. If you’re considering new property management software, visit Propertyware to see how our software can transform your business.

Editor’s Note: We have updated and republished this article to benefit readers new to the Propertyware blog.

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Property Management Accounting Software Relieves Tax Headaches

Marc Eiting — Mon, 10 Apr 2017 10:00:00 +0000

When spreadsheets are used for complex reporting and other business-critical functions, errors abound. An article from Forbes states that based on various studies, “88% of spreadsheets contain errors.” As you gather your financial and accounting data for the coming tax season, how confident are you that your spreadsheets are accurate? With accounting software, you can feel confident around tax time.

Error-free Property Management Reporting

Cash flow, along with other accounting information is used to determine how well a business is doing. Error-free reports are essential tools, especially during tax time. What can you do to ensure that your accounts receivable and accounts payable are up for tax time reconciliation? Switch to property management accounting software and you’ll reap these benefits:

Make rent collection more efficient and easier to track, so you know who owes what and how much rent came in over the course of the year. Use secure ePayments to make it simpler to receive and track online payments.
Automatically calculate adjustments, additional fees, and late fees and reflect these in your bottom line at tax time.
Track income from other sources, such as laundry fees, vending machines, and more.
Create a vendor ledger to track your expenses for each property and each owner.
Track the bills you’ve paid so that you and your owners can account for these on your taxes.

With property accounting software, the data that you collect is well-organized and more accurate. Not only does this simplify life for your property owners and tenants, it can also save you stress at tax time. Accounting software helps you understand your business and plan for the future.

Use Property Management Accounting Software As a Planning and Reporting Tool

Property management accounting tools don’t just help you run your business, they also help you plan for the future. A spreadsheet is not a planning tool, and depending on the accuracy of your entries, it may not be the best record of what occurred during the year.

Why Accountants Hate Property Management Accounting Software

If you want to amp up your property management accounting and your year-end reporting, try property accounting software instead. It allows you to:

Analyze trends across months or years, to help with budgeting and business planning.
Give access to different users at different levels, allowing multiple employees to understand data trends.
Export data in multiple formats such as Excel and PDF for your owners, employees, and taxes.
Reduce the crunch of owners asking for data around tax time by giving owners access to real-time data throughout the year.
Create versatile reports that allow you to see how specific properties or specific parts of your business are doing.

Prepare for tax time and get business analytics for better business decisions. Interested in learning more? Take a free online tour of Propertyware today!

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Tax Season Tips for Property Managers

Leah Mendes — Tue, 28 Mar 2017 22:06:53 +0000

It’s getting pretty late in the year as far as tax season goes. If you’re actively searching out tax articles concerning your property management business, you most likely fall into one of the following categories: You’ve either put it off so long you’re in a panic, or you’re in planning mode for next year. If you’re a procrastinator, this writer feels your pain. For property managers who drag their feet until the last minute, here are some things to be thinking about right now.

Vendor and Owner 1099s

If you haven’t mailed your 1099s out yet, do it today! The deadline has passed at this point and if you didn’t file for an extension and you cannot show reasonable cause for missing the deadline to the IRS, you may be facing penalties. You have until March 31^st to file them with the IRS and if you have more than 250 1099’s you must file them electronically. Not meeting this deadline could be costly for your business.

Close Out Your Books

If you’re still looking at 2016 when you open your financial software, it’s time to move on to 2017! Review your paperwork relating to vendors, property owners and tenants. Reconcile your bank statements against the data in your financial software. Make sure that nothing pressing has been overlooked, including for example receipts, payments, papers signed, and looming deadlines.

Owner Statements

Now that your information is all buttoned up, make sure your owners have their 2016 statements showing itemized income and expenses for the year. After all, they need to file their taxes too. If you don’t fall into the procrastinator category, you should be looking to the future.

Get Organized

If you’re not already organized and ready for 2017, you should get on that! Things like keeping receipts and tracking mileage can be a big help when it comes to making next year’s tax season a friendlier time. There are several apps for your phone that can make keeping track of mileage and receipts while on the road a snap. Also, don’t forget, if you work from home you may qualify for certain related deductions.

2017 Budget

Work on your 2017 budget. An annual operating budget is critical to success and puts a plan in place allowing you to measure progress throughout the year. If you use a property management software, make sure it integrates with your accounting software or, like Propertyware, it meets your accounting software needs out of the box. This will make life so much easier, making it less likely that financial data slips through the cracks. Budget for what you can expect. Ongoing costs are easy, but for those unexpected things now is the time to discuss with your owners how to set aside money to address future unforeseen problems. Lastly, you can take this time to evaluate your vendor relationships. Ensure that, like Propertyware, your property management software is able to generate a report showing how many work orders were assigned and how much money was paid to each vendor. Using this information should help you to negotiate fees. If you’ve been working together for a while, they may be willing to give you a better rate. It never hurts to ask!

Find a Qualified CPA or a Bookkeeper

If you find that you’re overly stressed when it comes to budgeting and finances, you might consider hiring a professional. As the owner, you likely are emotionally invested in the success of your business, which can (at times) cause you to make financial decisions guided by emotion rather than pure accounting. Bringing in a detached third party such as a CPA or bookkeeper can sometimes be the best decision a business owner can make. Take the stress out of tax season. Learn how rental property management accounting software can benefit your business. **Please note that this blog article, and its contents, is being provided for informational purposes only. It does not constitute legal, tax or accounting advice and should not be used or relied upon as a substitute for such advice. You should consult with a qualified professional for any legal, tax or accounting-related questions you have relating to the subject matter.**

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Your Property Management Software Checklist

Leah Mendes — Fri, 24 Mar 2017 14:58:02 +0000

The explosion of software apps has made property management infinitely more efficient, accurate, profitable and even enjoyable. Many of the headaches and hassles traditionally burdening property management professionals have been solved in the cubicles and break rooms of today’s industry-leading software companies. While these companies have produced an array of key solutions, choosing them ad hoc will only result in a hodge-podge of software that doesn’t work smoothly together. You’ll find yourself jumping from program to program, frequently re-entering information you’ve already entered elsewhere and working with several different user interfaces. It generally pays to source your software from a company that covers all the bases with solutions that share information and works seamlessly together. With this in mind, let’s run through the following checklist regarding the major areas of managing single-family properties. Look for:

Marketing
Screening and leasing
Interaction with owners and tenants
Inspections and maintenance
Accounting

Marketing

Today over 70 percent of rental property searches happen online. You simply can’t compete as a property manager without a strategy for marketing your properties on the Internet. You must start with a first-class website – one that employs best practices proven to convert visitors to warm leads. Internet marketing has existed long enough that expert website designers know exactly what captures and holds people’s attention – and then gets them to take action. Look for software that lets you easily create new listings, complete with photos, descriptions, pricing, and availability. It should provide an easy means of posting your listings to your website, as well as to other sites and listing services you use to advertise your properties. Once you have the website, you must ensure visitors can find it in the chaos of companies competing for the same space on the Internet. You need an organized program of search engine optimization (SEO), search engine marketing (SEM) and social media to be effective. Many property managers outsource these complicated activities to digital marketing experts. Finally, you need a lead tracking system that lets you systematically track every prospect from lead to lease, capturing their information and scheduling property visits. If no one on your team has the tools to follow up with good leads, those prospects fall through the cracks and equate to wasted time and money. Your marketing software should also let you determine which advertising sources deliver the best bang for your buck by associating leads and leases with the sources generating them.

Screening and leasing

Between deciding to rent at one of your properties and signing their leases, prospects should have a streamlined system moving them through the process. These days, nearly everything can take place online, virtually eliminating the drudgery and inefficiency of paper moving back and forth. Today’s online screening systems tap into huge databases of criminal and financial information to protect you from “bad” tenants, and they also help protect you from Fair Housing trouble since you set objective standards for acceptance. However, not all screening systems are created equal. For example, Propertyware’s screening and leasing solution is the only one that taps into 20 million renter payment histories – the most accurate indicator of whether someone will reliably pay their rent. If you’re not already, you should also enable applicants to fill out their applications and sign their leases online and at their own convenience. For good reason, the days of faxing, mailing or driving papers back and forth have waned. An online leasing solution allows everything to happen over the Internet, right through to a final e-signature, easing the burden on renters and saving your people hours of data entry.

Interaction with owners and tenants

Many problems in our business result from misunderstandings. Rather than getting in touch only when something goes wrong, property managers should generally keep lines of communication open with tenants and owners at all times. Tenant portals and owner portals not only foster better communication, they also centralize it in one location and track conversations, giving you a reliable record of what transpired in every exchange. Owners can keep an eye on their properties, and tenants can find the information they need 24 hours a day without calls to the office burdening your staff. In addition to improving communication, Propertyware’s tenant portal also enables online payments via credit card, ACH and other means, saving renters the trouble of mailing or dropping off checks.

Inspections and maintenance

Today, you can carry out inspections using your cell phone or iPad, and the information goes right into your software system, alleviating the need to return to the office and enter the information. You can even use the built-in cameras on your devices to attach photo documentation to your inspection reports. Users of mobile inspection software have reported reducing the time spent on inspections by up to 85 percent. When it comes to maintenance, the old confusion of mailing, faxing, or scanning paper orders and invoices have been replaced by a streamlined online system that routes documents to those who need them and stores everything for instant access. From initial service requests to paying vendors upon job completion, you no longer have to slow your people down with constant paper shuffling.

Accounting

Remarkably, many property managers still use off-the-shelf accounting solutions not specifically designed for property management. This software rarely integrates with their other software and inevitably results in accounting-related functions that take longer and contain more errors. Your property management accounting software should act as part of a seamlessly integrated system that enables you to share data since your accounting functions touch most others. The software should handle accounts payable and receivable, naturally, but also bank reconciliations, budgeting, and reporting. Though only covering the basics, this list still serves as a glimpse into the property management functions transformed by the newest software. If you still do business the old-fashioned way in any of these areas, you’ll be amazed by the results of systems custom-designed for our industry.

The post Your Property Management Software Checklist appeared first on Propertyware.

Eight Ways to Prepare for Tax Season

Leah Mendes — Fri, 10 Mar 2017 22:38:58 +0000

In a perfect world, we prepare for tax season all year long. In this scenario, we are 100 percent organized, all of our records are pristine and all the information we’ve ever collected from a tenant or property owner is complete and accurate. Don’t laugh too hard! We all know tax season never goes that smoothly and even if your business was completely organized and efficient, your renters and clients are only human. Keep Murphy’s Law in mind; errors will occur. Verify information early to begin tax season with confidence. If you manage a large number of properties and source work to various vendors, hiring a trustworthy seasonal employee gives you peace of mind that you have names spelled correctly, current addresses on file and tax ID numbers. Don’t forget to get your CPA’s help with W-9s for those who are receiving 1099s. Think ahead, and consult with your CPA on items such as when you may be required to electronically file those W-9s. Your tax deductions should also be a priority. Deductions, such as mileage, are standard fare on a per mile basis, but you should also consider whether items such as basic landlord insurance policies or blanket policies may be deductible. Other seemingly trivial tasks absolutely add up. If you manage a large number of properties, repairs, maintenance and general business expenses add up to significant deductions over the course of a year. Remember to keep track of expenses related to your office space and all corresponding supplies used to manage your properties—any home office space that is used to manage your properties.You may be able to deduct home expenses based on a percentage of square footage dedicated to your business. A good property management accounting software prevents you from having to track down receipts, payment records and client information. Consider these eight ways Propertyware accounting software can help you through this tax season.

1. Capture and collect payments

By adopting ResidentDirect, you are able to collect payments easily, without paying merchant services fees.

2. Simplify the process for paying bills

Accounts payable is so much easier when all of your notes, documents, vendor information, bills and payment info is organized and easily accessible.

3. Manage bank reconciliations

Picture all of your bank information, consolidated: bank account, deposits and reconciliations and much more. This organization greatly simplifies the year-end close as you get your books ready for tax time.

4. Enable online payments

Centralized payments made to your property owners and vendors makes a huge difference for your peace of mind.

5. Manage your budget

From property level to business wide, a portfolio of income and expenses can make you secure in your ability to see the big picture.

6. Manage fees with accuracy

Fee management and accounting tools are designed to make that part of your business a piece of cake.

7. Generate financial reports

In one click, you could be viewing your business from dozens of customizable, easy-to-read reports. From cash flow to profit and loss, your business’ financial health is at your fingertips.

8. Sync with QuickBooks®

Find relief in knowing that the right property accounting software can sync with your third party accounting software such as QuickBooks®, Microsoft Dynamics and others. These platforms streamline the tax preparation work for your accountant, saving you time and money. This time of year can be stressful, but with the right preparation and software at your fingertips, life can be easy, even at tax time! Learn how property management accounting software can help. **Please note that this blog article, and its contents, is being provided for informational purposes only. It does not constitute legal, tax or accounting advice and should not be used or relied upon as a substitute for such advice. You should consult with a qualified professional for any legal, tax or accounting-related questions you have relating to the subject matter.**

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