Real estate investors use worksheets and record keeping templates to keep track of all of the moving parts in a rental property, from property analysis and purchasing, to tenant leasing and rental property financial performance, and much more.
Here are 9 of the most important rental property record keeping templates that investors use throughout the entire investment cycle.
- Rental property templates are used by investors to manage real estate investments and track financial performance.
- Common property record keeping templates used by real estate investors include projected cost of ownership, tenant rent roll, cash flow, rental property chart of accounts, and a real estate balance sheet.
- A real estate balance sheet that is automatically updated provides investors with a better idea of the true amount of owner’s equity.
How to set up a rental property template
Setting up a rental property template correctly right from the start can save investors a lot of time and effort in the long run.
By staying organized from the beginning, it’s easier to keep track of which property belongs to what LLC (limited liability company) as more properties are added to a real estate portfolio. When a property is sold, providing a buyer with the correct due diligence documents goes much quicker and can help to avoid last-minute complications at the closing table.
Every rental property template should include:
- The name of the rental property or LLC the property is held under
- Date, such as quarter and year or fiscal period
- Name or title of the rental property template, such as cash flow report
- A note section for additional comments or pending tasks
9 rental property record keeping templates
Each of the 9 rental property record keeping templates below provides investors with a different “look” at the property before the acquisition, during the holding period, and when the rental property is eventually sold.
These record keeping templates are easy to create on a basic spreadsheet such as Microsoft Excel, Apple Numbers, Google Sheets, or Apache OpenOffice Calc. The free rental property financial management software from Stessa also automatically creates many of the reports below to help real estate investors maximize profits with real-time insights.
1. Cost of ownership
The purchase price and down payment is only one part of the true cost of investing in a rental property. Variables such as the estimated cost of immediate repairs, property taxes, property insurance, and the mortgage terms and interest rate vary from one prospective purchase to the next.
On the cost of ownership template, create columns for:
- Property address
- Type of home (single-family rental or multifamily)
- Immediate repairs (yes or no)
- Repair cost estimate
- Closing costs estimate
- Annual property taxes (may increase in future years based on the sales price)
- Property insurance (can vary based on the neighborhood rating, school district quality, and crime rate)
- Total estimated purchase price of each property
2. Screening prospective tenants
Landlords also create a rental property template to keep track of prospective tenant data. With the demand for rental housing as strong as it is today, it can be easy to accidentally overlook a qualified tenant. A tenant screening template can be created with columns such as:
- Tenant name
- Current address
- Monthly income
- Rent to income ratio (percentage of gross income)
- Credit score
- Background check (yes or no)
- Rental history report (yes or no)
- Contact employer? (yes or no)
- Contact current and previous landlords? (yes or no)
Online tenant screening services such as RentPrep and SmartMove allow landlords and property managers to download reports on prospective tenants. This allows screening documents to be electronically added to the tenant’s file, and provides backup that every applicant was treated fairly.
3. Tenant rent roll
Once a lease is signed and the tenant moves in, a tenant rent roll template is used to record key tenant information:
- The property the tenant is leasing (for landlords with multiple rental properties)
- The beginning and ending date of the lease
- Tenant contact information
- Rent amount and security deposit
- Link to an electronic copy of the lease stored in the cloud
Here’s an example of the rent roll that Stessa provides:
You can also download a free rent roll template here.
4. Property management and maintenance
Real estate investors who decide to self-manage a rental property often create a property management and maintenance template to provide a management overview.
Information on the report may include rent payment status of each tenant, maintenance requests, payments due to vendors, and open items such as landscaping and the next scheduled routine property inspection.
5. Rental property chart of accounts
A rental property chart of accounts serves as the foundation for keeping track of every financial transaction and record relating to the rental property. There are five main categories in a chart of accounts, along with sub-accounts with line items so that each transaction is recorded in the proper place:
- Rent payments
- Late fees
- Additional rent
- Property management
- Leasing fees
- Repairs and maintenance
- Property taxes
- HOA fees
- Mortgage interest expense
- Real estate owned
- Cash on hand
- Business checking account
- Business savings account
- Security deposit trust account
- Capital reserve account
- Refundable tenant security deposit
- Outstanding mortgage balance
- Business credit card balance
- Utility deposits (made by the landlord to open an account)
- Owner’s Equity
- Value of rental property in excess of mortgage balance
- Other funds invested in the rental property business by the owner
Rental property financial reports such as cash flow, profit and loss, capital expense, and the real estate balance sheet all pull data from different parts of the chart of accounts.
6. Cash flow report
The cash flow report for a rental property summarizes the amount of cash flowing into and out of each rental property over a specific period of time. A rental property cash flow report helps a landlord to better answer key questions such as:
- Are funds available to pay the mortgage before the next tenant rent payment is received?
- Is there sufficient cash available to fund the CapEx account this month?
- What are some ways to reduce expenses while still providing the same level of service to the tenant?
Here’s an example of what the net cash flow report from Stessa looks like for the first 8 months of the year:
7. Income statement
The income statements, also known as a profit and loss report (P&L), tracks the income and expenses of a rental property over a specific period of time. Information on an income statement includes gross income, operating expenses, and net operating income.
Most rental property owners – and rental property financial software from Stessa – model the income statement template after Schedule E (Form 1040). This simplifies the process of generating an accurate income statement, and helps to make filing year-end taxes quicker and easier.
Zillow has put together a rental income and expense worksheet template for Excel designed for owners with up to five properties. A copy of the most current Schedule E, Supplemental Income and Loss, for Form 1040 can be downloaded from the IRS here.
8. Capital expense report
Capital expenses in real estate are costs to improve a property beyond normal repairs and maintenance. According to IRS Publication 527, Residential Rental Property, examples of common improvements to a rental property include:
- Lawn & Grounds
- Sprinkler system
- Heating & Air Conditioning
- Heating system
- Central air conditioning
- Duct work
- Central humidifier
- Water heater
- Soft water system
- Filtration system
- Interior Improvements
- Built-in appliances
- Kitchen modernization
- Wall-to-wall carpeting
- Walls, floor
- Pipes, duct work
It’s certainly possible to create a worksheet template to list each rental property improvement and cost. However, the challenge is accurately tracking depreciation, because certain improvements have different depreciation schedules.
While the IRS allows rental property to be depreciated over a period of 27.5 years, improvements such as appliances and carpeting are depreciated over 5 years, while landscaping and fences are generally depreciated over 15 years.
A much more efficient way to track the useful life of capital expenses is by using Stessa. When a new capital expense transaction is entered into the system, Stessa will automatically ask the investor to enter a date placed in service and to make a useful life determination:
9. Real estate balance sheet
Investors create a real estate balance sheet template to monitor the long-term financial health of rental property.
The balance sheet provides investors with key information such as amount of cash on hand and current property value, amount of refundable tenant security deposits and outstanding mortgage debt, and owner’s equity in the rental property.
There are three sections to include on a real estate balance sheet template:
- Assets such as market value of the rental property, and cash in a business checking account.
- Liabilities including current mortgage debt balance, property taxes due, and outstanding invoices from vendors.
- Owner’s Equity is calculated by subtracting liabilities from assets.
Most real estate balance sheets carry the value of the rental property at the original purchase price. The problem with that approach is that property values change from one year to the next, which means owner’s equity can be understated (or overstated if property prices decline).
On the other hand, Stessa automatically updates the estimated valuation of each single-family rental property on the balance sheet monthly to better reflect the current amount of owner’s equity.
Here’s an example of the real estate balance sheet for the same single-family rental property.
The “Manual” column shows the original purchase price of the home, while the “Automated” column reflects the current market value of the home. Note the significant difference in owner’s equity at the bottom of the report:
|CapEx (capital expense)||$3,500||$3,500|
|Less: Accumulated depreciation||<$12,000>||<$12,000>|
|Tenant security deposit (refundable)||$1,200||$1,200|
|Credit card balance (business account)||$500||$500|
Having a more accurate idea of owner’s equity helps an investor to decide if the time is right to refinance, or pull cash out of one property to fund the down payment for another rental property.