How do you maintain your property portfolio if you own many properties?

Hi all,

I was wondering how people maintain their property portfolios when they have grown their portfolio to quite a large number of properties.

It becomes difficult to keep across the total rental income you’ve generating, your loan repayments, and equity and all your documents.

I am referring to folks who own a significant number of properties and may often buy a number of properties at a time – do you maintain your portfolio info yourselves or give it to someone to maintain it on your behalf? Any companies who do this for property investors with large portfolios would be good to know if someone can let me know that will be useful.

If you could also provide some ideas on how you maintain your portfolio info yourselves too that would be good, e.g. in excel doing it yourself, some other way, or using some external provider will be very useful.

Thank you.

 

One (or several) folders for each property.

• Rental statements - with agents paying expenses
• Lease
• Insurance
• Maintenance
• Etc

Or
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Shoebox.

 

That’s the time I realised that I’m wasting my time with small investments. Once I had over 40, I sold up everything and only bought investments that bring in a minimum of $150kpa and a land bank of broad acres in Sydney. The best and most profitable thing I ever did.

 

I dont have many, but multiple rentals too tenants and dealing with the PMs is a total pain in the ass to put it mildly.

Takes time to sort a system that sorta works for you, but no councils, insurers or PMs do the same things, so much to watch out for unless your swimming in income or do not rwally care that much....

 

Hi dabbler,

how do you keep track of rental statements etc, do you use Excel or put it in folders to something else? Curious to know how to do it.

 

No....,the statements just get put away, mainly browse them for any non approved expenses etc..........

I prob do things ass about, I know what should come in and go out roughly, so the bank balance and transactions are what I look at mainly.......

But there is always someone or something that throws a spanner in the works, so it is very much hands on I am afraid.....

 

Defining large number of properties will help surely?

But best thing to do is - let agency pay all the bills (Water, Council, Maintenance, bla bla)...

This way at-least you will get "one statement" once a month with all debits/credits listed. Match it to your bank account and away you go..

Having a book keeper is decent help too ...

Cheers,

 

I never let the PM pay for most things as a rule, cause I want to manage the money

It will depend on your situation though...

 

Hey Jazz - I'm looking at 2 main scenarios - firstly, owning around 5-9 properites.... other scenario is if you own 20+... I am guessing it will be best to use a different approach as you get to 20+.

By the way, what exactly would a book keeper do, and how do you find abook keeper?

CHeers

 

We only have 4 properties....but totally agree, never let PM's pay for anything and if we lived in Sydney would probably self manage as find its always a sting when I look at the end of the year how much they collect for how little they do during the year.

This said, my advice is setting up autopayments makes life easy.

eg every month the strata, council, water is auto paid out of my incoming rental account for 1/3rd of the qtr (and I adjust it up when there are increases annually).

The only real variation is in the mortgages (eg some months are longer with 31 days) but unless a tenant misses a rental payment there is nothing for me to do apart from "add" additional funds to the rental account to make up the mortgage shortfall after rents in and payments out (eg around $1000 pm-even this is auto setup for the 4th of the month-possible change figure if the rents were out) so basically im only really logging into the account once on the 3rd to make sure all inbound rents got credited, and once on the 10th to make sure all the outbound payments went fine.

The only real problem I have is that with 3 of the mortgages with St George having to hole punch the statements and make sure I file them into the correct folder as they don't have the property address on the monthly statements which I think is insane (eg have to match loan numbers or the amounts).

I think I could easily keep the same system for 20-30 properties without too much stress and spend far more time working on/worrying about our equity investments each month.

 

You really only need to review your rental statements each month, your annual rental statement once per annum, and pay your bills - rates, insurances , water and any strata levies ( if applicable) It's not very difficult. Even with 15 properties I would spend only a small amount of time on this each quarter.

Every now and then there may be a repair or warranty issue, or some other tenant issue - but they are few and far between and no matter what you do to try and develop a "system" those issues are outside your control.

The stuff you can control is records management. I have 2 filing cabinets dedicated to properties. I also retain all important documents on a NAS and on Dropbox and because I run a business I already have all that local storage backed up to CrashPlan as well. It's all automated and requires no real ongoing input at my end

 

I currently hold 7 properties..

All bills are paid by the agency incl maintenence but authorized by me.. And it surely works for me. I just tally them up at month end

Everytime their is maintenance issue, Ill get email or call depending upon urgency to approve but the actual payment comes out of rent..

Bookkeeper is handy if paying bills out of your pocket.. They can help keep track (Partly what agency does) ..

 

How about yourself @sash ?

 

The worst thing you can do is get the an agent to pay the Bills Just get consolidates bills. Only takes a few clicks and a few seconds to pay a Bill once the Billers are set up in Bpay. If you pay yourself you can pick up anomalies such as water leaks and overcharging you keep your fingers on the pulse and have a handle on costs. And save time not having to manage the manager. A decent accountant will have software that will work out income and costs for each property which is done automatically which is probably cheaper more efficient and easier than having a book keeper. You need an accountant any way so you may as well do it the way that is easiest and cheapest for them and every-one else.

 

Is this asking about how hard it is to run a marathon when your just walking 10 minutes to the station?

 

I pay PMs to manage.

If they don't perform over time I get rid of them.

All the difficulties are part and parcel of a large portfolio. I prefer newer properties now as when you add the maintenance and renovations on older stuff the profit is almost identical.

 

I don't have 20+, but I think my method will be the same as what I do now, regardless of how many I have.

1. A physical folder with settlement info, agency agreements etc.
2. A Google Drive folder containing a main spreadsheet linking to other spreadsheets, in their own folders under the property address. The main spreadsheet is set up to show me exactly what I need for tax time.

Yeah me too. I manage my own money.
I'd hate to come across a shock of wanting to buy another property, and getting rejected due to my credit rating being shot because the PM forgot to pay the bills for the last few months.

 

One of my many talents is that I am a qualified book keeper.

I created a spreadsheet basically the same as the one i run for our household expenses. Note, the Property sheet is far less complicated than our household one.

The months of the year go across the page and the incomes/expenses for each property go down the page, underneath each other with group totals plus comparisons to last year.

On the same page is a running Profit and Loss statement and then another little table with Assets and Liabilities. Cash flow is tracked monthly too. Once a month I reconcile the PM statements and our bank statement and record how much interest the bank charged on each mortgage that month. The most time consuming aspect is logging into each loan statement as they are each accessed separately at that particular bank. The fun part is watching how the mortgage balances and LVR decrease each month and the total value of assets is increasing whenever I update the market values.

PS @kierank, i still have no idea where on the Depreciation Schedules I would find the amounts to add, and some of the amounts change, so I still have no row for depreciation on each house. Tax time is always a total surprise. I have to leave something for the Accountant to do.