As a landlord, you need to be familiar with what appears on your rental statements. This document can provide valuable information about the income associated with your property.
To ensure you’re getting the most out of your rental statement, it’s important to understand what each section means. This blog post will provide an overview of what real estate investors need to know about their rental statements.
Key takeaways
- Rental statements show the date rent is due, how much rent is owed, and late fees.
- They also itemize charges for utilities, repairs, or other services.
- Rental statements can track income associated with your property.
- They can also help you keep tabs on when rent is paid and identify any patterns of late payments.
- To get the most out of your rental statement, you may wish to review it regularly and note any changes from month to month.
Rental statements: What they are and why they’re important
Your rental statement is a key document that provides insights into the rental income associated with your property. By understanding each section of the rental statement, you can make better decisions about your investment.
Here’s an overview of what you need to know about rental statements:
- Rental statements show the total amount of rent collected for a specified period of time.
- They typically list the date rent is due, the amount paid, and any late fees charged.
- Rental statements can provide valuable information about rental income trends over time.
- Landlords can make informed decisions about their investments by tracking rental income trends with rent statements.
Download your free rental statement template
Here’s a sample rental statement for landlords:
We’ve also put together a free rental statement template you can download in Excel and PDF formats:
How rental statements can help landlords manage their property
Let’s look at best practices for reading your rental statement.
First, it’s important to review the rental statement carefully to ensure that all of the required information is accurate. If a rental statement shows that a tenant is paying rent late or has not paid rent at all, the landlord should contact the tenant to discuss the situation. The landlord may consider offering the tenant a payment plan or grace period. If the tenant does not make rental payments as agreed upon, the landlord may have grounds to begin the eviction process.
Next, take a close look at the rental income trends over time. This necessary information can be helpful in making decisions about rent prices and investment strategies. For example, if rental income is trending downward, this could indicate that rent prices are too high and need to be lowered to attract and retain tenants. On the other hand, if rental income is trending upward, this could indicate that the rental market is healthy and that rent prices can be increased.
Keep in mind that rental statements are just one piece of information that you can use to make informed decisions about your investment. Other factors, such as market conditions and the condition of your property, should also be considered.
If your property is in good condition, it is more likely that tenants will want to rent it. However, tenants may be less likely to rent if your property needs repairs or is not well-maintained.
Both market conditions and property conditions can also affect vacancy levels. A healthy rental market with lots of demand for rental units will typically have lower vacancy levels. Conversely, a rental market with high vacancy levels will have less demand for rental units.
How to automatically create rental statements and track rent payments
To automatically create rental statements and track rent payments, simply sign up for a free account with Stessa.
Stessa, a Roofstock company, offers free cloud-based software that helps real estate investors maximize profits through smart money management, automated income and expense tracking, personalized reporting, and more.
The company was launched in 2016 by 2 experienced real estate investors with 30 years of combined experience. Stessa was built to take care of monitoring and analyzing details so you don’t have to. More than 100,000 investors already use Stessa to track over 250,000 properties with more than $60 billion in asset value.
Once you have an account, you can add your properties and start tracking rental payments.
You can also set up Stessa online rent collection so your tenants can make online rent payments directly to your account. This may increase the likelihood that rental payments are made on time and give you a record of all rental payments.
In addition to automatic rent payments and rental statements, you can monitor your rental property performance online via a comprehensive owner’s dashboard and generate key financial reports, including:
- Rent roll. This report shows tenants who are currently renting from you, their contact information, and rental terms.
- Occupancy report. This report shows the current occupancy rate for your rental property. This is useful for identifying future vacancy periods.
- Rental income report. This report shows how much rental income you have earned for a specific period of time. This is useful for tracking performance and goals.
- Expense report. This report shows all of the expenses associated with your rental property, such as repair and maintenance costs, marketing expenses, and so on. This is useful for determining how much you spend and how much you can save.
- Profit and loss (P&L) statement. This report shows your rental property’s financial information, such as income, expenses, and net profit. This is useful for tracking overall financial performance.
- Cash-flow statement. This report shows cash flow for a specific period of time. This is useful for tracking money coming in and going out of your rental property and for identifying periods when the rental property may be cash-flow negative.
Final thoughts
A rental statement is a summary of the rent payments made by a tenant over a specified period of time. Rental statements are important for landlords because they provide a record of rental payments and can be used to track financial performance.
Free rental property financial software from Stessa can automate the process of creating rental statements and collecting rent online from tenants. This may help you save time and money while managing your rental property more effectively. Sign up for a free account today to get started.
