5 Ways Xero Helps Landlords Manage Property Portfolios Efficiently
Let’s face it, Cloud accounting’s sole purpose is simplification. As Certified Xero Partners, we’re well accustomed to the Xero Add-On Directory and here we’ll lay out the best picks that let landlords get the most pertinent functions out of the Xero cloud accounting software to make your complete portfolio management a breeze.
- The right add-ons
There are thousands of add-ons available from Xero allowing you to tailor the software to exactly what you need and only that. Two of the best add-ons for landlords include:
- Pocket Rent
To help distinguish the two, Pocket Rent is best suited to residential landlords with small to mid-sized portfolios. Re-Leased is better placed for managing commercial, residential or a mix of both types of property rentals and can cater to any size of portfolio, no matter how varied it is.
- The Cloud Improves Your Financial Control
When your focus is on business growth you are probably going to need to raise finance. To access that, you need well controlled, managed and professionally presented reports with all the key ingredients financial backers need to invest in you before you can invest in expanding your portfolio.
That’s where tailored Xero solutions really come in handy.
You get powerful features to automate much of your accounts, and your reports are always one click away. That’s the reports that matter and they can be broken down into categories, which makes apportionment super simple for landlords.
- Faster Returns Submissions
Your end of year returns must be submitted on time to avoid late payment penalties. And it’s in your best interest to get these in as early as possible because if you’re due any refunds, the earlier HMRC and you know about it, the sooner you’ll get the refund into your accounts to provide more cash flow.
- Better advice from your accounting partner
That’s us and yes, this is a shameless and blatant plug. To make it sound less salesy though, any Certified Xero Partner will be better positioned to advise you better.
What we find with our landlord clients is that because of all the information collected, stored and available with custom reporting from Xero, we’re able to give them timely strategic advice, any time of the year, based on the real-time data available. This is invaluable for our clients because we’re able to advise on minor problems, thus preventing them becoming a major headache.
Moreover, inputting and automation of data collection is simple, and it mitigates the risks of inaccurate data entry. That means less mistakes in your accounts, translating into better cash flow because accounting errors carry with them more expenses. You don’t need that and that’s why managing your property portfolio, including individual stock inventory is essential for landlords.
Quick tip: Templates can be created once and duplicated making stock inventory fill-in-the-blank simple.
One of the things residential landlords must have in place is good control and reporting over their stock inventory, especially for furnished rentals.
Take for example this list as a starting point for a stock inventory template:
- Light fittings
- Wood work
- White goods
- Electricals (fireplaces, television etc.)
With the above, you can simply fill out a form, print it and go through filling it out for each of your property rentals detailing what’s included at entry level and then re-checking for exit.
With Xero, you can simply create the template, duplicate it, add it to all your properties and any new ones and point, click and complete your way through the form. The more details you have, the more successfully you’ll be able to challenge any tenant claims that you’re retaining any part of their security deposit unjustly.
- Full Picture of Your Entire Portfolio
If you’re only managing a single property, you can do it with spreadsheets alone. Managing a portfolio though, you can’t be doing that on paper. Time is money and is best spent strategically. To do that you must have the ability to manage individual properties on a categorised basis, preferably by room, and be able to switch to your complete property portfolio.
This is the key advantage of cloud accounting. It pulls in all your financial data into one place, and lets you consolidate that data to give you the full picture of how your business is functioning financially, showing you with precision, where you’re most profitable and where your maintenance costs are increasing, as well as providing the ability to set reminders for maintenance, such as boiler servicing etc.