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How to create a rent roll report in Xero

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by Jeff Rohde, posted in Investment Strategy

Xero is used by about 3 million people worldwide to simplify everyday business tasks. The software receives high ratings for general-purpose accounting for small businesses. 

Unfortunately, when it comes to creating an important real estate report like a rent roll, Xero leaves a bit to be desired. That’s because the program isn’t specifically designed for rental property owners.

In this article, we explain what a rent roll is used for, then take a deeper dive into using Xero to create a rent roll. Finally, we explore a full-featured alternative for generating a rent roll.

Key takeaways

  • A rent roll includes information about a tenant on a single page, including tenant contact information, monthly rent and payment history, outstanding balance, and the lease term.
  • While Xero isn’t specifically designed for real estate investors, it’s doable to create a rent roll using the software.
  • Before using Xero for a rent roll, an investor must learn the terminology that the program uses.
  • Stessa rental property software is a good alternative to Xero because the program was designed by real estate investors for real estate investors.


What is a rent roll used for?

A rent roll is a single report that consolidates information about a tenant, a lease, occupancy, and rent payment history all in a single place. 

Data on a rent roll is used by landlords, property managers, real estate investors, and lenders to understand the income generated by a rental property  and whether the future rental income stream will stay the same, increase, or decrease.

For example, a landlord or property manager can review a rent roll and quickly tell if a tenant is past due on the rent. If a tenant is late, a landlord can remind the tenant to pay and assess a late fee without having to review the entire tenant transaction ledger. 

If the lease will be expiring in the next few months, a landlord can run rent comparables to determine if the monthly rent price will need to be adjusted. After conducting a quick rent analysis, a landlord can contact the tenant about renewing the lease or begin marketing the home for a new occupant if the existing tenant does not plan on staying.

Analyzing a rent roll can reveal changes to future gross income and the impact on cash flow. If a lender or potential buyer determines that the current rent is above market compared to similar homes in the area, the rent price may need to be reduced at the next lease renewal to avoid losing a tenant.

A rent roll provides information for the top line of a profit and loss (P&L) statement. By using a rent roll to get a snapshot of the current and potential gross income, an investor can subtract the property’s operating expenses to get a better idea of the current and potential net operating income and cash flow being generated to more accurately determine property value. 


woman looking at finances on phone and computer

Can Xero create a rent roll?

Xero is a New Zealand-based company founded in 2006 and rated as an excellent choice for small business accounting software. The company has sales and support websites for the United States, along with countries in Europe and Asia.

Although Xero isn’t specifically designed for rental property owners, it is possible to use Xero to create a rent roll. However, there are a few things investors should be aware of first.

Because Xero is general-purpose software used worldwide, the nomenclature in the program is somewhat different from what real estate investors with rental property in the U.S. are used to:

  • Rental property in Xero is known as a “Tracking Category.”
  • Multiple rental properties are labeled “Tracking Items” and can be placed under a Tracking Category to monitor the financial performance of a portfolio.
  • Alternatively, each rental property can be assigned its own Tracking Category.
  • Tenants are called “Contacts” in Xero.
  • A rent roll is known as a “Transaction History.”
  • Transaction History (rent roll) reports for each Contact (tenant) can be run to get a complete picture of a Contact’s (tenant’s) history.
  • Contacts (tenants) can be organized into saved smart lists and groups to show how Contacts (tenants) are Tracking—in other words, paying their rent. 


How to use Xero to create a rent roll

After setting up a rental property as a Tracking Item and a tenant as a Contact, rent invoices can be generated and rent payments received. By running a Transaction History from the online dashboard, a landlord can:

  • View contact information and financial settings.
  • View account balances.
  • See a history of invoices, payments, notes, and emails.

For multifamily investors, one of the drawbacks of Xero is that income can be tracked at the property level but not for each individual unit. 

For example, if an investor owns a triplex, the rental income from all units is grouped into one lump sum. A Transaction History (rent roll) report can be run for each Customer (tenant) in the property and for the entire property, but a consolidated report for the entire property will not itemize each unit.  

Here’s a screenshot from Xero’s U.S. website illustrating what a Transaction History (rent roll) report looks like:

xero rent roll

A landlord can also use the “Notes” field on Xero to enter information about the Contact (tenant) and connect emails from a Gmail or Office 365 account. 

The Xero App Store offers integrated third-party online property management apps, such as RentHQ to import and track rent income and expense transactions from Xero, and Bnbtally to integrate with Airbnb and Xero for detailed bookkeeping with short-term and vacation rental property.


Is Stessa a better choice than Xero for a rent roll?

While Xero makes an admirable effort to provide a rent roll report, Stessa, a Roofstock company, can provide a faster and more logical way. That’s because Stessa was specifically designed by and for rental property owners to provide real estate tools, such as a rent roll, to the investment community for free.

Stessa doesn’t require a landlord to learn new terminology to get a rental property set up and running. Tenants are tenants, a property is a property, and a rent roll is a rent roll. A rent roll report on Stessa can be generated with one click, and a landlord can see tenants, leases, and units all on a single page.

After entering information on the Leases & Tenants page to populate each property, a landlord can simply run a Rent Roll Report to create a clear, one-page summary that can be shared with business partners, a lender, or a potential buyer.

Stessa’s Rent Roll Report can be run by Portfolio and by Property, with each line on the portfolio report representing a specific unit or property, tenant details on the right,  and property details on the left. Stessa makes creating and sharing a rent roll easy by providing options to generate PDFs or Excel spreadsheets.


Final thoughts

A rent roll provides a summary of the tenancy of each home in a rental property portfolio and each unit of a multifamily property. A rent roll from Stessa includes key information, such as tenant contact information, rent amount, monthly rent paid, lease terms, and security deposit amount.

Information on a rent roll is used by landlords, property managers, investors, and lenders to maintain and improve cash flow, analyze potential deals for investment, and as part of a borrower’s documentation when a rental property is being purchased or refinanced.

While Xero can be used to create a rent roll, it requires an investor to learn new language terminology. Rather than reinventing the wheel, investors looking for a faster and better way to make a rent roll can sign up for a free account with Stessa and generate a complete report with one click.


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