Between now and 2027, the property management industry will see a 3.5% growth. Many people have begun to invest in real estate, and rightfully so; it's a fantastic way to increase your cash flow each month in a more passive way.
If you want to ensure your success in real estate, one thing is certain: you will need to secure property management bookkeeping. Bookkeepers will ensure that all your records are accurate and prepared ahead of audits and tax filings.
Want to know which records you need to keep on file? Read on below.
All Tenant Files
The reason you need to keep tenant rental files is just in case you need to pull them for reference in the future. Not only do you need to keep files for current tenants, but it's also a good rule for them to keep the records for past tenants. This is because there are times when you will need to charge tenants for late fees or damages after they've moved out of your property.
Several different types of documents will be included in the tenant's files, such as:
- Policies regarding pets
- Security deposit information
- Tenant background screening
- Rent increase notices
These are just a few of the items you will want to keep for your records to cover yourself, especially when you need to enforce the lease agreement between the tenant and yourself.
Maintenance Requests
Another record that needs to be kept is all information about maintenance requests. This is important because if you have to purchase parts to complete these requests, you can write them off as business expenses.
However, you need the records to support your write-offs to claim them as business maintenance expenses. Not only should supplies for repairs be documented, but also for routine maintenance such as landscaping and inspection tasks.
Financial Documentation
In your property portfolio, one of the things you might have to show is how you went about increasing the value of the properties you were tasked with overseeing. This can be beneficial if you're seeking funding or other capital to continue showing potential clients you can do your job.
There are several types of financial documents you need to keep, which include:
- Copies of all checks
- Tax statements
- Funding ledgers
- Banking statements
- Security deposits from tenants
If you don't wish to keep tangible financial documents, there are several types of software that will support your financial recordings. Using these types of software reduces the chances of human error when inputting financial information into your property management portal for later use.
Property Management Bookkeeping: Records to Keep
When it comes to property management bookkeeping, you need to keep several types of records. From tenant information to finances, you're going to want to have a system to keep everything in order.
If you want access to useful property management and tenant resources, contact Green Tree Property Management today.
