QuickBooks Online Advanced for real estate property management, Part 3: Producing reports
QuickBooks® Online Advanced is Intuit’s latest cloud-based offering designed for fast-growing, complex businesses, allowing my clients to grow and remain in the QuickBooks Online world. I love this because it means I don’t have to go out and learn a new accounting product when my customers start to expand.
This article is is Part 3 of a 3-part series that describes how to use QuickBooks Online Advanced for real estate property management. Part 1 is an overview of Advanced and who it’s for, plus details about how to get set up to work with these kinds of companies. The other two articles include:
Prefer videos to articles? I cover all three parts of this series in this video.
Editor’s note: Find out more about Seth David’s course, QuickBooks Online Advanced for Property Management.
Reports in QuickBooks Online Advanced for property management
The first thing you’re going to want to know about is who is late with their rents. In California where I am, once someone is late – it’s the 2nd of the month and we have not received their rent – then we can post a “3 Day Notice to Pay Rent or Quit.” This is a requirement as part of the eviction process should it come to that. So, it’s very important that we get rents posted right away and get this report out. Then, the managers of those properties can post the notices.
A simple accounts receivable (A/R) report will cover this need. Run the Open Invoices report. Anyone who is on it is late and/or has balances due.
The Rent Roll report is another report that is very well known in property management. This is where those custom fields come in; QuickBooks Online products will not produce a “true” rent roll. In order to get the same data, we will want to set up two reports.
It’s actually two versions of the same report. We’ll run a customer balance detail report with our custom fields included. Then, we’ll run the same report, unfiltered as to A/R status. This will show everything, and as time goes on, it will get very long. This will be most useful when filtered for a particular unit/tenant. This will give you that tenant’s entire history.
Vacancy rates and other high-level analysis
Finally, we will want to look at vacancy rates and some other high-level analysis, such as rental income vs maintenance expenses. For this, we’ll use Fathom, which is designed to help analyze key performance indicators. In the property management context where you are managing properties that belong to others, it’s important to remember that almost everything is on the balance sheet. We can look at cash flows, for sure.
The one metric I want to highlight here that is unique to property management is your occupancy rate. In the video that will also show you how to set this up, I kept calling it the vacancy rate, so this is just the flip side of the same coin. With Fathom, you can set up non-financial KPIs, and then import or key them into Fathom to get them on your reports.
To set up this custom KPI, you’ll head into Fathom’s settings, Step 4 KPIs, and click “Create a KPI.”
In the next screen, choose Non-financial, and then set up your Custom KPI as shown in the screenshot:
Then, to add or update it, choose Update Data (Step 1 in Settings):
QuickBooks Online Advanced gives you those extra features that make managing properties a simple process, while offering detailed reporting capabilities. In the end, you want good information so you can report to your stakeholders, or in this case, your property owners. They need assurance that their properties are in good hands. A good system with accurate and timely reporting will make that happen.