Is Quickbooks property management suitable for managing rental properties? To put it another way, Quickbooks property management may be used to manage rental property accounting transactions. You may set up properties as customers, renters as sub-customers, and classes to monitor different kinds of transactions in the software. You’ll need something to monitor rent payments, costs, payments, and earnings, regardless of whatever software you choose. Should your company rely on manual methods like spreadsheets? Or should you use well-known accounting software like QuickBooks? While Quickbooks property management is an excellent accounting system for most things, it lacks the tools you’ll need to properly manage your properties and become a better landlord.
Should You Use QuickBooks Property Management in 2022
Quickbooks property management is a widely used accounting program that comes in both desktop and online versions, with the latter boasting over 3.9 million users. For example, Quickbooks property management Online, for example, is used by a range of businesses, so it’s conceivable to utilize it for your property management requirements. It is best utilized by a property manager who manages small-to-medium-sized properties.
What Are the Benefits of Quickbooks property management for Landlords?
When you use the desktop version of Quickbooks property management, you can set up your corporate and customer files in different ways. This will let you take care of things like collecting rent from renters and paying property owners and management agencies, as well as paying for things like property upkeep. It’s worth noting that there isn’t a version of Quickbooks property management designed specifically for the real estate or property management industries.
As a result, you’ll have to be flexible with the application and make a few modifications and alterations to get it to perform the way a property owner wants it to. In Quickbooks property management, for example, you’ll be able to create and manage two business files: It’s up to the owner of a rental property business to collect rent, pay expenses, and run the place.
- A property management firm: A file for getting money from property management This will allow you to set up renters and suppliers, accounts, and products, record security deposits, track rent income, record costs for each property, and pay the property owners while keeping the firms’ operations separate.
- You’ll be able to add property owners as clients, create accounts and goods, and track property management income from the property management side.
- If your property management company looks after a lot of big properties or complexes, you should think about getting a new system. A trust accounting system might be better for a professional property manager.
Regardless of what accounting software is used to keep track of property management accounting, the following facts stay the same: After the rent is paid by the renters, the money must go to the owners of the house. This money should be held in a separate account from any other account that is used to pay bills. Any money you receive from the owners for the work you performed (your management fee) should be deposited into your personal account.
In QuickBooks, how do I record transactions for a property management company?
Unfortunately, Quickbooks property management lacks this sort of simple account management, which is why managing several properties with Quickbooks property management may be challenging. However, Quickbooks property management has guidelines on how to record transactions for a property management firm on their website:
Prepare a company file for a rental property company
This is where you keep track of transactions and record rent revenue and costs for each property you manage.
- Create tenants and vendors: consumers for properties, renters for tenants or jobs for properties, and vendors for owners.
- Organize your accounts and items. There are things you can do to build up assets like checking accounts and liabilities like security deposits. You can also make money by renting out your space and paying for common area maintenance (CAM).
- Keep track of your security deposits: For a security deposit, use a liability account.
- Keep track of your rental income: If you expect to be paid later, record rent revenue as invoices; if you expect to be paid straight away, record it as sales receipts.
- Keep track of the following costs for each property: Keep track of property costs, including upkeep, utilities, and repairs.
- If you’re paying them later, record them as bills, and if you’re paying them right away, record them as checks.
- Owners of real property are compensated: Profit and loss records can help you figure out how much money to give to the person who owns the property. Make the payment with checks and identify it as a vendor payment.
Prepare a company file for a property management company
Keep track of your own financial activities, like how much money you make and how much money you spend managing properties for other people.
- Customers should be property owners.
- Organize your accounts and items. Create assets for checking accounts, furniture, and equipment expenditures; liabilities for payroll liabilities; income for income; and expenses for insurance and utilities.
- Income set a new high: If you expect to be paid later, record management income from property owners as invoices; if you expect to be paid straight away, record it as sales receipts.
The Use of QuickBooks Property Management Has Its Limits
When it comes to accounting for small businesses, Quickbooks property management may be one of the most popular tools. However, it doesn’t have the skills needed to handle rental properties. QuickBooks can be set up to handle rental property accounting, but it’s not as easy as it could be with software that is made for this type of business. In order to set up the software effectively, a company will need to have an above-average awareness of the software’s ins and outs, which will result in a longer learning curve for your personnel.
A client site where tenants can check their rent statements and pay their rent is not available to them. When you send out invoices for rent collection, tenants don’t have access to this site. This also implies that they are unable to set up automatic payments. Tenants will also be unable to do non-financial things like check their lease terms or make a maintenance request (work order).
To send bulk emails to renters (for example, announcements), property managers won’t be able to do things like run background checks, eSign lease contracts, or see tenant work orders. It may be difficult to leave an accounting program that you’ve used for years, but many people find that having all of those functions in one location is far more convenient. QuickBooks may excel at its best features (such as tracking transactions and monitoring cash flow), but it may fall short for a property manager who isn’t patient enough to work around these limitations, for someone who wants more than just financial features, or for someone who wants software tailored specifically to their needs.
Alternatives to QuickBooks Property Management Software
There are a lot of solutions available if your company believes it has outgrown QuickBooks or would like something that is more industry-specific. One method is to determine what is most important to you.
- Do you want the greatest software in terms of overall performance?
- Do you want one that focuses on small property management firms?
- Do you want to make use of web-based software?
- Are you seeking a less expensive alternative to QuickBooks?
All of the software options below can help you run and maybe even grow your rental property management business. They all have financial management features, as well as other features that can help you run and maybe grow your business.
For both residential and commercial property management, AppFolio is a great fit. This makes it one of the best all-around options, no matter how many properties you manage.
On the market, this app has one of the most up-to-date interfaces. It also has advanced marketing tools that let you post job openings on your website and connect with third-party hosting sites.
You can also set rent increases based on the terms of the lease, deal with maintenance issues quickly, and more.
There is no need for an extra application and screening tool, as well as a third-party accounting system like Quickbooks.
Features for commercial use were made to handle more complicated leases, customized reporting, CAM reconciliations, and other tasks that needed to be done.
DoorLoop is a web-based service that allows you to change prices and has fully integrated accounting, marketing, and maintenance functions. It is a good choice for a business that is growing quickly and needs to add more properties and units. DoorLoop can have as many properties, users, training, and support as you want.
Unlike other property management solutions that charge per unit, DoorLoop features a tiered pricing structure that allows you to pay only $49/month for up to 20 units when you first start with their Starter plan. DoorLoop is currently 50% off until 2022, making it a top online property management software and an excellent chance to try it out to see whether it’s appropriate for you.
Owners, real estate brokers, and property managers can use Hemlane as an all-in-one rental property management system. Hemlane’s lease tools, local help, maintenance coordination, and management tools make it easier than ever to run a business. Small companies will find Hemlane’s basic plan to be more than enough, with the opportunity to upgrade to a more premium subscription if their needs change.
Leases with marketing and tenant placement tools, local agent tools to assist owners in connecting with managers and agents, management tools to handle finances and lease management, and maintenance tools to handle repair requests with your repair staff are among the major capabilities.
TenantCloud is a free cloud property management software that landlords and renters may use to manage their properties. Landlords can accept payments online, screen applicants, manage their money, and set up a free website to list their properties. In the meantime, tenants may fill out rental applications, pay rent online, keep track of their payments, and seek maintenance. Landlords with fewer than 75 units should utilize TenantCloud’s free edition. This version supports one user and up to ten unique rental agreements and notification templates. The monthly fee for the premium version is $9.
Buildium is a full-featured property management system created by property managers for property managers. A tenant portal and an owner site help the software keep track of property accounting, business finances, and reporting. Online payments are also handled by the software. Because Buildium can handle a lot of units, it’s best for rental management companies that deal with homes.
Buildium is a property management software that starts at $47 per month but has a unique a la carte cost structure that only makes sense if you manage at least 50 properties. Managing one unit, for example, costs $47 per month; managing 50 units costs only $31 per month. A “Pro” version is available, which features free EFT payments, bank account creation, and electronic leasing.