If you're working with a property management company to keep your rental units on track, you likely receive owner statements every month. Whether you get these via an owner portal, email, or other means, it's important to read them carefully.
This data can provide useful clues to help you improve your investment properties' performance, gauge how they're doing at the moment, and come up with cost-saving ideas.
Read on to find out more about the information contained in your monthly owner statement.
What Are Owner Statements?
Owner statements are similar to a report card for rental properties. They contain important information about the relationship between your income and expenses.
Now that the IRS has adjusted the threshold for paying taxes on rental income, they're more important than ever before.
What's Included in an Owner's Statement?
If you own multiple properties, your monthly owner statement provides useful information about occupancy rates. This can help you compare what's working and what's not across your properties.
Your property finances are the main focus of owner statements, and you can expect to find the following information included every month:
Rental Income
This part of your owner statement itemizes all the payments received for a property during the month. These include rental income as well as other payments, like:
- Late payment penalties
- Laundry fees
- Parking fees
Carefully considering this information may also help you identify habitual late payers by highlighting overdue rents.
Monthly Expenses Related to Your Property
Every property incurs a host of expenses every month. These may include:
- Property taxes
- Insurance premiums
- Property management fees
- Utilities
- Repairs and maintenance
- Landscaping and lawn care
Many of these items are tax-deductible, so you must go through them with a tax professional when calculating your taxes.
This section is also an excellent place to look for potential cost savings. An experienced property manager can help you figure out how you can save on these regular expenses.
Net Income
Net income refers to the difference between each property's income and expenses. A negative number in this section means you need to make some changes.
If you can't cut down on your expenses, you might need to consider raising your rent to cover your costs more effectively. Raising your rent always carries the risk of decreasing demand for your units or losing the tenants you have.
A detailed rental valuation can help you calculate a fair rent for your properties based on similar ones in the area. Working with a property manager helps simplify these calculations.
Maximize Your Florida Rental Units
Owner statements contain valuable information for property owners, but the best way to maximize this data is by working with a property manager.
PMI Daytona Flagler is your first choice if you want to access a wealth of local real estate knowledge. We are backed by over two decades of property management experience, and place a high value on helping our clients succeed.
Browse our blog for more landlord advice and rental property tips, or reach out for assistance with maximizing your investment portfolio.
