If you're in the real estate market, you have the opportunity to generate a lot of wealth. However, you need to have an understanding of all elements if you want to achieve this.
Owner statements are just one thing you need to know about. These tools are crucial for property management and provide a lot of data that can help with property owner financial management.
So what exactly are owner statements, and how can hiring a property management company help? Keep reading to find out.
What Are Owner Statements?
Owner statements provide detailed information on the financial activities of any rental properties you own. This includes things like:
- Money coming in from tenants
- Maintenance costs
- Property expenses
These property accounting tools allow you to follow your finances over time. They provide an insight into how your properties are performing so you can adjust your management strategies for better results.
Analyzing Rental Income
Your profits come directly from rental income. Owner statements give you clear, detailed information on this.
The figures on rental income statements show you how much a property is bringing in each month and you can identify trends and patterns. You'll be able to see if the income is increasing, decreasing, or steady.
This information can help you determine if you need to make any adjustments to your current rental rates.
Managing Property Expenses
Expenses will reduce your profits, and while these are unavoidable, managing them can make quite a difference. Having financial statements that provide information on all the costs of your properties will help you determine if money is being spent appropriately.
From this, you may be able to determine areas where you're spending more than you should be. You can then make adjustments to improve efficiency and save money. Effective management of maintenance practices can also help you increase the value of your properties.
Additionally, staying on top of maintenance can improve tenant satisfaction. Your current tenants will feel less inclined to leave, so you won't have to worry as much about periods of vacancy.
Net Cash Flow
Net cash flow is one of the most important measures to keep track of in property management reports. It shows how much money you're actually making after paying all expenses. It's the sum of the overall income minus the expenses in the owner statements.
This shows the actual profit you're making, which is the most important figure for many landlords. Ideally, this should always be positive as this means you're making more money from your properties than they're costing you. If it's negative, then you need to make some changes.
Assistance With Owner Statements
The information gathered from owner statements is vital, but it can also be very complicated. Many landlords don't know what to do with the insights they're gathering.
A professional property management company like PMI Aspire can help here. Our experienced team can help you understand the information in owner statements and provide guidance on what to do with this information.
We also offer a full range of property management services throughout Denver and the surrounding communities. Check out our property management page for more.
