If you're a landlord in Oklahoma City who's working with a property manager, you likely receive owner statements every month. Have you been disregarding this correspondence due to a lack of understanding?
If so, you need to start paying attention. These documents are important for managing your landlord finances and can help you with strategic planning for your property portfolio.
Read on to explore what you can learn from your owner statements.
What Are Owner Statements?
Owner statements are like progress reports for your investment properties. They contain critical and detailed information that can help you keep track of your earnings and expenses.
The IRS has recently lowered the income threshold for landlords, so if you're earning rental that exceeds this new limit, your owner statements will come in very handy at tax time.
Understanding Your Owner Statement
Owner statements help you stay informed about the income derived from your properties every month. By analyzing this information every four weeks instead of once a year at tax time, you can quickly pinpoint problem areas and act on them.
Landlords who own more than one property should pay attention to the occupancy rate portion of the owner statement. This section helps highlight low occupancy rates. Using this, you can identify areas for improvement by comparing poor-performing properties with successful ones.
The rest of your owner statement deals with aspects related to rental property accounting. These are:
Rental Property Income
This section lists all the sources of income related to your property. It includes rental income and other amounts like parking fees, late charges, and laundry payments.
Glancing at this portion of the statement will reveal overdue rents and help you identify tenants who habitually pay their rent late.
Property Expenses
Being a landlord isn't all about profits. All rental property owners incur ongoing expenses associated with their investments.
These include:
- Property management fees
- Insurance premiums
- Incidental costs
- Maintenance and repairs
- Property taxes
Your owner statements detail these expenses to help you benefit from deductible expenses when completing your tax return. Your property manager can help you identify areas for cost savings in this section of the report.
Net Income
Here, you will discover the profitability of your property at a glance. This part of the statement shows the difference between your rental income and operating costs.
If you're running at a loss, you'll notice a negative figure in this section. Sometimes one-off repairs or refurbishments are the cause of this, but ongoing losses suggest that you need to work with your property manager to cut your costs or consider increasing your rent.
Getting the Most Out of Your Oklahoma City Properties
Owner statements are important tools for keeping track of your Oklahoma properties' performance. They're most effective when compiled by a professional team of property managers.
PMI OKCity Local is backed by a franchise with 20 years of real estate experience. We provide all our landlords with detailed monthly owner statements and are on hand to assist with landlord advice to help you make the most of this information.
Get on board with our dedicated team to see your Oklahoma City investment properties thrive.
