Case Study 2
Property-Level Bookkeeping for a Multi-Property Rental Owner
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Real estate | July 2023
A long-term rental property owner with multiple properties
Applegate Inc. is a rapidly growing California-based rental property company managing a diverse portfolio of residential properties. As a long-term property owner, it focuses on efficient property management and sustainable portfolio growth.
Client Overview & Business Challenge
The client owns several rental properties, but income and expenses for all of them ran through shared bank accounts and cards. Rent, repairs, mortgage payments, property taxes and insurance were mixed together, so the client couldn’t see how each property was performing. Year-end tax preparation meant hours of sorting transactions by property.
Strategy & Approach
- Set up QuickBooks Online with a class for each property, so every transaction is tagged to the right one
- Built a chart of accounts suited to rentals: rent income, repairs and maintenance, property management fees, mortgage interest, property taxes and insurance
- Split mortgage payments into principal and interest, and reconciled every bank and card account monthly
- Sent the client a regular list of review items and open questions, so issues were cleared monthly instead of piling up for year-end
Results & Business Impact
- A clear profit and loss for every property using QBO's P&L by Class report, not just the portfolio as a whole
- Reconciled, tax-ready books by property, which makes Schedule E reporting quick for the client's CPA
- Better decisions: the client could see which properties made money and which didn't, and use that to decide on rent increases, repairs and whether to hold or sell
- Cost savings: property-level reports highlighted high repair and maintenance costs, so the client could review vendors and control spending
- Lower tax prep costs: clean, categorized books meant less time and lower fees at tax time, with fewer missed deductions
Key Learning
For a rental owner, books are only useful if they’re organized by property. Tagging each transaction to its property from day one, and clearing open questions monthly, turns a pile of mixed transactions into reports the owner can make decisions from.
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