Successfully managing a vacation property is dependent on how organized you are, especially when it comes to your bookkeeping and accounting. If crunching numbers, creating spreadsheets and mashing calculators isn’t exciting for you, outsourcing is an option. A numbers lover (aka accountant) can help keep track of income and expenses, and they can even help Uncle Sam get his cut when tax time rolls around. A dedicated accountant can be a great asset but can also be costly. The good news? You can manage your bookkeeping on your own with little know how. If you’re going to try and do it solo, here are a few property management accounting basics you should know.
Create + Monitor Reports
The biggest indicator of future behavior is past behavior. If you want to see where you’re going, you have to have a way to see where you’ve been. That’s top priority when it comes to property management accounting basics. Whether you manage one property or 50, you need a way to document your financial history to make gains in your financial future.
For instance, if you can look back and see that a particular property costs you $X in maintenance fees each quarter, you can actively work to resolve those issues instead of blindly continuing to pay them—and losing money. Analyzing your reports will also give you an idea about how often your properties are occupied, how much you make per reservation, and how you can adjust your strategies to improve.
Using vacation property accounting software that allows you to create custom reports can be a great way to understand your financial past while making informed projections for the future. QuickBooks is a great tool that syncs with vacation property management software like Bookfull!
Simplify Your Processes
When you have the right tools, managing a vacation property fits seamlessly into your already busy lifestyle. It’s vital that you use tools and software that work together so that you’re not spending precious time bouncing back and forth between various systems. Property management accounting can seem like a daunting part of the management process, but when your software works for you, it can truly simplify things. Having the ability to link your vacation management software with other apps like Authorize.net and QuickBooks makes sending and receiving money to guests, vendors and other parties a breeze.
Provide Online Payment Options
Giving your guests various options for payment has many benefits and can simplify the accounting process. These days, almost everyone pays for everything online. According to a recent study, almost 76 percent of Americans prefer to pay with a credit or debit card vs. writing a check. Don’t pigeonhole yourself by limiting the way people can pay for their vacation. If your software doesn’t offer ePayment options, you could be missing out on bookings.
Giving your guests the option to pay online offers many advantages for you too. When guests use credit cards, for instance, you can get your money faster—often in less than 48 hours. And because you’re providing a payment method that many of your guests prefer, you’re establishing a positive rental experience even before they visit your property! Plus, if your software syncs with your payment processors, that makes your property management accounting that much easier. You can quickly identify income sources, pull reports and keep tabs on cash flow.
Go High Tech
Asking for a receipt and filing it away in a folder is so 2001. You’re way too busy to keep track of every single receipt for every little transaction—especially if you’re managing more than one home. Welcome to 2017, where vacation management software is available to help keep an eye on all of your expenses for you. If your software doesn’t automatically sync with Quickbooks and update every time you get a booking, it’s time to make a switch. Innovative software like Bookfull makes it easy to crunch numbers, increase sales and cut costs all from one convenient location.
Remember, This Is A Business
Vacation property management is a people-centered business that revolves around priceless family memories, happiness, and excitement. But at the end of the day, it’s still a business and should be run like one. Managing a vacation property successfully means finding the balance between giving guests the vacation of their dreams and making the most amount of money at the same time. Running your vacation property like a small business means you’ll need to:
- Evaluate potential risks
- Anticipate consumer’s needs before they do
- Invest in security
- Stay on top of market trends
- Respond quickly to reviews
Charge fees and fines when fair and necessary, and don’t make financial decisions based on your own personal budget. Stay on top of your competitors’ pricing brackets, and price your home accordingly. Just because you wouldn’t pay $250 a night for a home doesn’t mean the rate is too high. Use tools like PriceLabs to make informed pricing decisions. Run your vacation property like a business because, well, it is one.
Bookfull Makes Property Management Accounting Easy
Understanding property management accounting basics might not be the most fun part of owning a vacation rental, but it’s definitely one of the most crucial for success. If your numbers aren’t adding up and you’re spending more than you make, things can go downhill pretty quickly. Invest in software that makes staying financially organized easy and stress free, so you can focus on the areas of the industry that you love.
At the end of the day, you need vacation property management software that works for you. Something that keeps track of your income and expenses, makes it easy for guests to pay, and keeps you on a path toward financial gains. Bookfull does all of this so that you can lead your already busy life while the accounting and bookkeeping gets done in the background.
Try it for free today!