How to Create a Real Estate Ledger

Deapending on the kind of real estate ledger, you can use excel or do it the old fashion way....either way, keeping track of real estate and all expenses associated with is can be a key to your success in real estate ownership.

Instructions

Difficulty: Easy

1. Notebook or excel spreadsheet will be needed to keep track of each expense. Put each expense into a category, such as maintenance, taxes, dues and or fees, insurance, and landscaping. Then breakdown each of these categories as needed for more detail, such as roof maintenance, electric maintenance, plumbing maintenance, HVAC maintenance, etc. Then keep track of purchases for each of these category. If you are doing this for rental property (income generating), separate these categories as above, but do it for each property. What you will find is a pattern developing if you do this for a period of time, such as a year. For example, if you have roof repairs over a year and they total $1000, you may find that you will be better off to get a new roof with a 20 or 30 year guarantee. So, the key is do let your ledger be your guide, for a detailed and well maintained and organized ledger will show you patterns from which you can make good decisions and choices.
2. Determine that you are going to keep detailed records of each expenditure.
3. Force yourself to the discipline of keeping all receipts until they are entered into the ledger.

Tips & Warnings

• Be organized, keep it simple, and be able to change is as your needs and circumstances change.
• Do not treat property ownership or management carelessly.