I’m new here. I am dabbling into REI, and property management. I own two dingle family homes and both sides of a duplex. I have just started managing two multi family homes that are a total of five units for a local guy that just moved out of state.
I found a contract online that looked pretty good and spelled out the expectations of both of us, but I am looking to make a monthly report to him about his properties. Do any of you have a sample report that I could customize? What do you like to see on your report?
I was considering making a monthly report showing cash flow and activity, and then a quarterly or semi annual report that is more detailed that might show return on equity and information on the loan so that he is seeing the changes on it.
It looks like you have a good handle on it. I would run the contract past my lawyer to protect myself. It mostly is what your customer wants, but what you described is what I get.
Redhawk :beer
Reports can be simple or can be pretty complex based on the property and the demands from the owner. You should talk to your owner and see exactly what he is looking for in a report. Management companies usually make up an annual budget for each property catagorized into line items for expenses. Their monthly reports show the chart of accounts month-to-date and year-to-date. That way the owner can see what was spent for the month and so far for the year in each catagory (utilities, landscaping, etc.).
Some of those same things can be done by QuickBooks. On QBPro, you can separate properties by classes and then have those expenses charged to the class. Then you can run various financial reports by class and show things like Profit and Loss.
Since you say you are “dabbling”, I assume you don’t have any type of RE license. Most states require a brokers license in order for you to accept payment for managing someone else’s property and many states will not allow you to represent the owner in court.
BLL, you bring up a good point here. Conducting fee based management without having a brokers license could probably put a person at risk legally when tenant issues arise and maybe with the owner of the property as well. For example, if I hired a management company that messed something up pretty bad at my property and then find out that they don’t even have the required real estate license, that could be grounds for a lawsuit against the so called management co. I’m not a lawyer and this is just a scenario I could see happening.
Call, fax or write your state Real Estate Commissioner, or real estate licensing office. You definitely need to know what the requirements are for managing property that is not your own.
I’m not sure I understand the logic here - I am not taking part in any buying or selling transactions - merely collecting rent, showing the units to possible tenants, and doing maintenance. Which part of that required the license?
I went ahead and called the Real Estate Licensing office for the state of Kansas and they said as long as I don’t use any options in the contracts and stay in residential property that I do not need a license. This makes a lot more sense to me!
Anyway - thanks for having me call! The first information I got was bad.
Apparently KS only requires a real estate broker’s license to manage commercial property. Residential property management does not require a real estate broker’s license.