Peter Lohmann's Newsletter - Issue #187

Hear me out: Accounting Software should help you Do Accounting

Every property you manage is a micro-business that someone lives inside.

And you’re the accountant, controller, and CFO of that business:

• You collect the rent. That’s accounts receivable (AR).

• You pay the plumber that fixed the leaking toilet. That’s accounts payable (AP).

• You handle security deposits. Those are liabilities.

• You do owner draws. That’s movement in equity.

• You issue monthly and annual owner statements. That’s financial reporting.

• You collect W-9s and issue 1099s at year-end.

• Etc Etc

The software that we use to handle these things (AppFolio, Rentvine, Buildium etc) is…. OK.

But every time I’m dragged into an accounting question or problem at my management company, I can’t help but think… Why isn’t this easier?

Why am I paying not one BUT TWO accounting groups to handle my trust accounting and corporate accounting respectively?

Despite that, why am I still getting accounting questions and problems hitting in my inbox so frequently that I had to hire ANOTHER accountant to handle those?

Why doesn’t our accounting software handle not just the day-to-day rent collection and bill payments, but the predictable edge cases and problems as well? I’m talking about stuff like…

• Uncashed checks

• Duplicate payments to vendors

• Tenant rent refunds

• Security deposit transfers

• 1099s

• Mysterious or missing deposits

• Mysterious or missing withdraws

• Moving money between an owner’s properties

• Withholding owner distributions if they just sent money for a repair

• Instant ACH payments (especially to one’s own management company!)

• Pro-rated management fees at the beginning and end of a PMA

• Owner refunds

• PM Biz reporting (not property reporting)

• Basic data around owner/property churn, profitability, NOI, lease renewal rates…

I could list 50 of these. Every property manager reading this is nodding their head right now. When you manage hundreds of properties, these aren’t theoretical accounting problems for a textbook. You’re hitting at least one of these every day. And the software we use provides NO HELP. You are own your own for this stuff with a few exceptions here and there depending on the specific software you’re using.

Why can’t our software make this WAY easier!?!?!? Especially in the age of AI there is NO excuse. Accounting is the most AI-friendly thing EVER. There are rules, and are historical transactions, there are a finite and well-defined set of data locations. GET AFTER IT, SOMEONE, PLEASE!!!!

If you want to get a sense of what I’m talking about, and what we should all be able to use every day, right now, just watch this video:

Jason here is giving a demo of Digits, a new Quickbooks/Xero competitor [no affiliation, not affiliate link].

But there’s NO reason that 100% of the features he demos in this fascinating video can’t be made available to property managers inside their trust accounting software. None.

Let’s take a break from every software trying to do everything and focus on the BASICS please. Thank you for your attention to this message.

What It's Actually Like to Sell Your PM Company

Bri Leichliter built her company in Cincinnati from zero to 220 doors, ran it for four years, and sold it last fall. I'd been following along the whole time, so I wanted to get her on to share the unfiltered version - not the polished conference recap, but the real thing.

We get into how she ran the sale process herself (no broker), structured an installment deal with a true-up instead of a clawback, and navigated the emotional side of handing over relationships she built one by one. She's honest about what went well, what she'd do differently, and the moment her boyfriend told her he'd be happy if she sold for zero.

(Also available on Apple Podcasts & Spotify)

Property Management Companies For Sale This Week

• This 1,000-door HOA + residential PM franchise in Coral Springs, FL is still available (asking $300k)

• Absentee-run PM company in San Jose, CA (asking $120k, 12 properties under management)

• Residential PM book of business in Delaware County, PA (asking $250k, ~90 units)

• Here’s a high-performing STR management portfolio in North Carolina (asking $1.9M, ~$1.26M annual revenue)

• Profitable PM business in Fresno, CA (asking $350k, ~$420k annual revenue)

Sponsored by DoorLoop, PM software built for operators who take growth seriously. Growth exposes weak systems. In this on-demand session, you'll learn how to clean up your operations, improve portfolio visibility, and build processes that actually scale.

Industry News & Events

• Marc Cunningham announced the sale of his company, Grace Property Management, to Associa. It will operate within the RHOME Property Management division.

• Crane applications are closed. We received over 100 in total. A warm welcome to all our new members reading this newsletter.

• Propmodo is doing a 2-hour paid workshop exploring a zero-employee multifamily property management company. Details here.

Closing Thought

A few quick things before you go…

• Last week’s issue went to 21,890 readers (50% opened, 4% clicked)

• The most popular link was about the demo of Quickbooks killer accounting app (199 clicks)

• Property managers: Your professional trade association is NARPM. You need to join if you’re not already a member.

• Did someone forward you this email? Subscribe here.

Software I’m using to scale my 700+ door property management company:

Note: These are affiliate links, but I’ve been recommending all these companies long before any financial arrangements came into place.

The content of this newsletter is for informational purposes only and does not constitute professional advice. I may have consulting agreements with, or financial interests in, companies mentioned in this newsletter. Additionally, some of the links included in this newsletter are affiliate links, meaning I may earn a commission if you make a purchase through these links. Always perform your own due diligence before making any financial or business decisions.