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

Discussion in 'Investment Strategy' started by realestatefellow, 22nd Sep, 2018.

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  1. Gazza215

    Gazza215 Member

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    Realestatefellow - glad it helps - it’s a very professional tool. Yes - get all your properties in there first and just track them going forward.

    I try to update my financials and statements minimum once a month in PropertyDirector (inc loan balances).

    As an ‘old school’ man myself I’m not much of a tech guy but once I started using it, it’s my key go-to. I hate storing my info in a hundred different places.
     
    realestatefellow likes this.
  2. Brody Hales

    Brody Hales Active Member

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    I saw the PropertyDirector.com.au guys before as they seem to be advertising across Youtube and LinkedIn. Have to say they're pretty polished and its easy to use. They seem to be free right now so I am going to milk it for what it's worth lol
     
  3. MyPropertyPro

    MyPropertyPro REBAA Buyer's Agents Sutherland Shire & Surrounds Business Member

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    I have a double digit portfolio including here and overseas. To be blunt, it takes a fair amount of work but you have to have some flexibility and trust in your PMs. This is not to say you have to trust them blindly, but "managing the manager" applies here too.

    I used to pay essentially all the bills myself but it was a lot of work - I was literally paying multiple bills daily - so it became easier to have it all appear on my statements which was a much tidier package to hand to my accountant at tax time too. I even will transfer money to an agent's trust account to have them pay an invoice on my behalf to ensure it appears on the statement and therefore EOFY statement for this same reason.

    I use a combination of the following:

    1. Google Drive with a series of folders containing all the pertinent information from purchase right through to rental statements and bills. All kept in their own categorized multiple sub-folders that make sense to me. I also keep a blank master file structure that I can duplicate for when I make a new purchase.

    2. Spreadsheet containing summaries of the miscellaneous tax entries related to personal tax but with columns for each property to add items that can't appear on statements e.g. depreciation

    3. Cash flow software that I update with any change to rental amounts or interest rates. At the end of each FY I also do a full "spring clean" using accurate information from last year's tax return which helps me to see what cash flow position I'm in and make better predictions for the coming FY.

    4. A separate capital expense spreadsheet for any non-immediate deductions that will come into play at sale. This includes my purchase costs and any renovation costs, maintenance that is not immediately deductible. I also then pass this information onto my depreciation company to wrap into my schedules which they update. I have enough properties now that I don't pay for this service.

    That's pretty much it. I do find mistakes occasionally (non-payments, double payments, missing water reimbursements) so it's something to stay on top of but I just see it as part of the journey.

    Cheers,

    Andrew
     
  4. skater

    skater Well-Known Member

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    I took a quick look at this & added in some properties, and played around a bit. Yes, it does look nice & pretty, but it has some serious shortcomings.

    Firstly, there is no allocation for offset accounts against the loans. If you enter in all your data, there is no way to accurately account for an offset. Yes, you can enter in that a loan amount is less than it is.....or you can put the payment amount as a lessor figure, but I don't like that.

    Secondly, there is no allowance for any other income, other than the rental income. So, if your tenant pays the water, or you have NRAS properties, no place to enter this. This is needed for accurate tax records.

    And finally, if you have more than one asset class, you can't add that, so it doesn't give you a total net worth, which would be nice.

    So, my opinion of this is that it's fine if your starting out, or you've only got a few properties, but it's not really suitable for a large holding as not everything is covered.
     
  5. Beano

    Beano Well-Known Member

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    The programme does not seem to generate the correct profit
    Maybe it assumes everyone loses money lol
     
  6. skater

    skater Well-Known Member

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    I noticed that if you put in a loan amount of zero, to account for the fact that it is fully offset, but there's still a loan in place, it still calculates repayments., you have to manually change the expense to zero. I didn't bother looking at any profit (or loss) after that.
     
  7. Beano

    Beano Well-Known Member

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    I tried with one property that had one tenant ...the most simple one on p & I then on interest only
    Could never get it to give the correct profit ...gave up after that
    Not going to put anymore in !
     
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  8. Francesco

    Francesco Well-Known Member

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    I would use the spreadsheet to forecast the income tax payable for the coming year so that a section 15-15 withholding variation can be lodged with the ATO for annuities/salary to be taxed appropriately throughout the year. This helps with cashflow.
     
  9. Beano

    Beano Well-Known Member

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    Looking at the Property Director I can see the benefit of the "cloud storage" of documents but I not relaxed to have all my files uploaded if the system the does not work.
    Are there any other systems out there I can look at ?
    Capacity is for 110 to 200 tenants
    Files say 10 per tenant so say 2,000 documents
    Not too fussed on budgets as the General Ledger System I have does have budgets
     
  10. realestatefellow

    realestatefellow Member

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    Hi Andrew - agree about trusting property managers, that is important in my book. I've been lucky most of mine have been great.
     
    MyPropertyPro likes this.
  11. realestatefellow

    realestatefellow Member

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    Hi Skater - as I don't use offset this is not really an issue for me, but I agree it's probably they should probably add. About tenant paying water, couldn't you just add this to the income? If you are saying you want this tracked separately, it make sense. Also, for NRAS, again, I guess you mean you'd like to see it separately? If so, makes sense.

    I own 15+ properties (located throughout AU), and it's working really well for me, so not sure I agree with the fact it's good for a few properties... if anything it's better if you have more properties.
     
  12. realestatefellow

    realestatefellow Member

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    Hi Beano - on profit, is this the cashflow or capital gain profit? The property director rental and interest calcs for interest are perfect and something I always rely on, and I got 15-20 properties. I'm a stickler for detail and no way I would have missed this.
     
  13. skater

    skater Well-Known Member

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    I disagree. I use MYOB, with a Job Number for each property & there's no issue with tracking ANYTHING, as it's a Business Tool. It's perfect for the Accountant too, as I just send him a file at the end of the year with all the info.

    The reason I said that it was only any good for a few properties, is that it looks very amateurish to me. All pretty looking, but with no real substance, and I would never recommend MYOB to someone with a small portfolio. I don't see how anyone having more than 15 properties would NOT have at least one offset. That's pretty basic, & something we've had since, well, almost the start. We're running something like 14 offset accounts now, so this is cruitial. Everytime one gets filled up, another one started.
     
  14. MyPropertyPro

    MyPropertyPro REBAA Buyer's Agents Sutherland Shire & Surrounds Business Member

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    No need to use a spreadsheet, my software does this for me!

    Myself and our clients have been using ITWVs for many years.
     
  15. realestatefellow

    realestatefellow Member

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    Hi Skater - no probs, I guess we just see things differently. I've used MYOB before and for me, it's the last thing I would use for maintain a portfolio. For me, I want something simple that's built for property investors where I can just put everything in (other systems I have used makes me put bits and pieces everywhere and I can't see what i want in one place). I has what I am after.

    The different systems people use is interesting to know, and people you do what feels comfortable to them I guess..
     
  16. Beano

    Beano Well-Known Member

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    The net profit is weird
    Sent you a pm
    I will send you a email
    How can you work out a cash flow per property when you run the portfolio as a group and the cash all goes in and out of one account ?
    You would you be there forever doing the numbers
    Also how do you show a capital gain on a property not yet sold ?
    How do you deal with a property that sometimes includes gst and others that don't and where part of the purchase price is for super rent.
    Also how do you deal with fitout rental ?
    Gst on rental?
    Multiple loans on one property ?
     
  17. realestatefellow

    realestatefellow Member

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    Hi Beano - I've just responded via PM with my email address, will wait to hear from you.
     
  18. skater

    skater Well-Known Member

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    It doesn't have everything in one place, I've already highlighted a couple of issues with it, @Beano has noticed other things that it can't handle either.

    What about expenses of a capital nature....nowhere for them. Once you have more than a handful of properties, you NEED to be able to lay your hands on this information easily.

    Like I said. It's too simple! It's not built to handle complex portfolios, and mine's not as complex as it used to be. Beano's got commercial, so his isn't a simple portfolio either.

    To be honest, I'm a little suspect about this topic. You're a newbie here & most of your posts are in this one thread. It seems to me, that with how interested you are in this product all of a sudden, that maybe you have a vested interest & your original question was a leading one with a vested interest in gaining new business.

    Also, you said this

    So, first the question as to how we manage the portfolio.

    Then the two different scenario's.
    This post was dated Oct 17.

    Now it gets interesting. Why do you need to know how someone with 5-9 properties maintains their portfolio if you have 15+ properties. And who has so many properties & no offset?
    So now, you always rely on this, even though you only just registered less than a Month ago?
     
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  19. Handyandy

    Handyandy Well-Known Member

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    This software has serious short comings. Seems to me whoever designed this was a spreadsheet user and has used a spread sheet as the model. Also I would not trust any company to hold my information with no access should they loose interest or go broke.

    Personally we get RE sheets that contain multiple properties (large portfolio) and we have software which allows us to batch in the whole sheet in one go. This process also checks the entries as the total of the 'batch' needs to equal the sum of all entries. The batch total is the amount in the bank which is then reconciled in the bank account (manually).

    Main motivation for getting the software written was that I didn't want to have to separate out the commissions, petty's etc for each property on the RE's statement which the software does.

    Also any software should track the dates for which rent was collected there are pre payments, part payments or heaven forbid no payments. I want to have those dates checked to ensure they line up from month to month.

    Out of this process I can get a report per property or combined properties or total for company/structure etc.

    We use MYOB for accounting.
     
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  20. realestatefellow

    realestatefellow Member

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    Hi Skater - there is no vested interest here.

    Skater, I truly don't use offset accounts for my portfolio! I had asked about 5-9 properties and 20+ earlier on to see if investors are utlising a different system from when they initially started their portfolio and then they transition till now - maybe I didn't explain myself clearly.

    I also have nothing against MYOB, I was just talking about my experience with it working in a small business environment. It's an accounting tool, and i have no particular interest in either product (or anything else for that matter).
     

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