According to Salary.com, Columbia landlords earn an average of $50,378 yearly. But to become a top-earning landlord in Columbia, you must first master rental owner statements. They're critical documents that, if appropriately utilized, can help you maximize your rental income.
Our team of experts at PMI Columbia Riverbanks has shared financial management tips regarding owner statements and how they help simplify rental-related finances, so read on.
1. Help With Efficient Owner Income Tracking
Well-prepared rental owner statements help you accurately monitor cash inflows and outflows. Cash inflows refer to the money that comes in, including late fees and rental payments you collect. Outflows are the expenses related to owning, operating, and managing your rentals, such as:
- Included utilities (e.g., gas, water, and electricity)
- Property maintenance and repair bills
- Marketing vacancies
- Tenant placement costs
Since rental owner statements provide a detailed breakdown of inflows and outflows, they allow you to determine if you're profiting. If more comes in than goes out, then yes, you're generating profits and earning income.
2. Find Areas of Improvement
Suppose your monthly financial reports reveal that your expenses exceed your rental income. Your owner statements can serve as a guide, pointing out items that cause you to spend more than necessary.
Utilities are perfect examples. If you include them in your rental rates, they can considerably affect your income. Per EnergySage.com, Columbia's average home electric bill costs $203 monthly!
Your owner statements can tell you if your tenant's utility bills are above average. If so, your tenants may not be practicing energy conservation strategies. Inefficient appliances you've furnished the rental with may also be the culprit.
Either way, the property management insights you gain from your statements can help you find and lower high-cost areas. For instance, you can require tenants to conserve energy. You may also want to invest in better, more energy-efficient appliances.
3. Minimize or Control Repair Expenses
Owner statements can also help you with timely property maintenance and repairs.
For instance, suppose you've discovered your tenant's water bills have considerably increased. However, they say there hasn't been a change to their typical usage. The culprit may be water leaks, which a lack of plumbing maintenance or an aging system may cause.
Regardless of the cause, get a contractor to inspect and perform the necessary repairs. Otherwise, the problems may worsen and cause you to lose more rental income.
Use Owner Statements to Make Educated Financial Choices
Well-prepared owner statements help you determine whether you're profiting from your rentals. They also give you insights into areas you can cut costs on and help you schedule timely property maintenance and repairs.
If you're too busy to prepare accurate statements but still want to generate income as a landlord, PMI Columbia Riverbanks will be happy to help! Real estate accounting, including owner statement generation, is part of our full-service property management solutions. We'll handle the physical and financial management, and you can simply reference your statements to monitor your Columbia rental's performance.
Reach out today for a free property analysis and discover more about our services!
