Users who are on PMv1 (Legacy) will have to go through an upgrade process to utilize PMv2. However, the upgrade is not publicly available at this time. The PMv2 upgrade is in Private Beta and will become widely available as soon as possible.
The "everything is an expense" theory in property management emphasizes the importance of meticulously tracking and managing all costs. This theory posits that every activity, resource, and transaction should be recorded as an expense, whether direct or indirect. By understanding and controlling these costs, businesses can gain insights into their financial health, improve profitability, and make informed strategic decisions. This approach is particularly valuable for short-term rental companies due to the variable and dynamic nature of their operations.
As of October 2024, the Property Management premium feature includes more flexibility in configuring and displaying expenses and allows the creation of custom formulas for owner statements. This upgrade is included as part of the Property Management premium feature you already subscribe to. To take full advantage of the latest Property Management accounting enhancements, we recommend completing this as soon as possible to ensure the best data is stored going forward.
Why didn't we just release this one-way, non-reversible Property Management Upgrade for all users? An upgrade of this magnitude will significantly impact the appearance of your owner statements and affect your property management business and operations.
For most users, you will likely want to adjust your statement views immediately after upgrading and before issuing any new statements. Rather than force you to accept those changes on our schedule, we thought it was better to offer a transition period during which you can read about the changes and new enhancements and then upgrade when it is most convenient for your schedule.
What's changing?
When you enable the Property Management Upgrade, OwnerRez will implement the following changes:
- OwnerRez will begin tracking expense records for Commission, Taxes, and Damage Protection (if applicable) on new bookings. This means your Owner Statement Summary report can break these items out for more accurate Profit and loss statements going forward.
- Statement Views no longer offers complex columns for things like "Net for Commission" or "Owner Net" that are subjective in nature. Instead, you can define your own columns and utilize our Custom Formula builder, which allows you to define your columns based on specific calculations.
- You can configure transaction fee (e.g., credit card processing fees) expense settings separately from channel fee expense settings.
- Each owner's previously configured channel fee will be ported to the new "Transaction Fee" configuration.
- Owners that use the "Pre-deduct from earnings" channel fees option will be automatically set to "Show as reimbursed expense."
- Owners who prefer their statements to include any booking expenses only if they are included will be automatically set to use prorated booking expenses.
- Booking expenses on owner statements may be prorated if desired.
- Expense records no longer offer "Owner Visibility" settings. All "hidden expenses" are marked as "permanently excluded" to prevent them from appearing on future owner statements. Instead, Statement Views will have a "Hide Booking Expense Category" option to control owner visibility.
- Any related expenses will also be excluded when a booking is excluded from owner statements.
- Existing owner statements and PM statements will become locked and undeleteable.
OwnerRez will also initially suggest any changes we think you should make to help transition to the new owner statement design during the Property Management Upgrade process.
The Property Management Upgrade Status has been added to the PM Settings section, allowing you to check your upgrade process and suggestions even after completing your review and marking the upgrade complete.
Expenses
Effective expense management offers key benefits. It can boost profits by clarifying costs for each property and improving budgeting. Tracking expenses helps identify cost-cutting opportunities and informs better investment decisions. This focus allows property managers to concentrate on their most profitable properties.
In OwnerRez, expenses are items paid on behalf of your owners for which you need reimbursement. This includes tracking expense records for commissions, taxes, and damage protection (if applicable) on new bookings. Your Owner Statement Summary report can break these items out for more accurate Profit & Loss type statements going forward.
The critical expense areas include the following.
When configuring your surcharges, the Expense and Commission areas (Settings > Pricing > Surcharges > Expense and Commission) allow you to control how they affect your expenses. Here are the Surcharge > Expense and Commission default settings.
Because the default surcharge settings affect your vacation rental business' bottom line, it is imperative for you to review those surcharge settings to confirm your choices.
When configuring your taxes, be sure to review the Expense area (Settings > Pricing > Taxes > Expense). Here are the default Tax > Expense settings.
If you are responsible for remitting taxes, you'll want to be sure that this section is completed. The Date to Use section can also be set on the system wide PM > Expenses > Settings section covered next.
PMs can configure some system-wide defaults for expenses by navigating to PM > Expenses > Settings.
You can determine what booking default dates to use for expenses and select your Damage Protection PM Account (if configured).
Expense records no longer offer "Owner Visibility" settings but instead include an option to "Hide Booking Expense Category" to control what is visible to owners on Owner Statements.
Expenses can also be edited on the individual Booking Expenses tab.
Statements
Owner
Owner Statements are now more versatile. They can hide expenses and a Custom Formula Builder, where you define your columns based on specific calculations.
If you were previously configured before October 2024, your pre-Property Management Upgrade custom statement views are copied and labeled "Legacy," while the new post-Property Management Upgrade copies are labeled "Standard."
If any of your views use the columns listed below, we modified the new Standard version of those views to remove or adjust the column types as noted.
- Booking > Gross – replaced by Custom Formula:
[Gross] - [HiddenExpenses](Note that the Gross column is still available on Standard views but will display the entire Gross minus hidden expenses as a total amount.) - Booking > PM Commission – replaced by Expense Category > Commission
- Booking > Damage Protection (or Owner Damage Protection) – replaced by Expense Category > Damage Protection
- Booking > Owner Taxes – replaced by Expense Category > Tax
- Booking > Pre-Deducted – replaced by Hidden Expenses
- Booking > Net For Commission – replaced by Custom Formula:
[Gross] - [NonCommission] - Booking > Rent + Show-As-Rent – replaced by Custom Formula:
[ChargeCategory_RentOnly] + [CategorizedAsRentCharges] - Booking > Owner Amount – replaced by Custom Formula:
[Gross] * [PercentInPeriod] - [Expenses] - Booking > Owner Revenue – replaced by Custom Formula:
[Gross] - [FullCommissionCharges] - [Expenses] + [ExpenseCategory_Commission] + [ExpenseCategory_DamageProtection] - Booking > Owner Amount – replaced by Custom Formula:
[Gross] - [Expenses] - [ExpenseCategory_Tax] - [ExpenseCategory_DamageProtection] - Booking > Taxes Paid By – removed
- Booking > Damage Protection Paid By – removed
- Expense > Owner Visibility – removed
The easiest way to start owner statements and payouts from scratch is to issue one statement per owner and the corresponding payouts one day prior to the date you want to begin sending Owner Statements, such as the last day of the month prior to sending your first Owner Statement. This essentially creates a "baseline" so that the OwnerRz system thinks each owner is paid through the end of the month.
You can add as many Booking Columns as desired by clicking on the +Add Column at the bottom left and you can edit the column Title as desired. Many columns allow you to either Prorate the amount or Show Total by checking the checkbox in those columns. You can also add Help Text for each column to customize your Statement Views. Finally, you can click on the right-side trash can icon to delete that column if necessary.
Property Management
Reports
The Property Management Upgrade includes one new report that contains only bookings remitted after you enabled the PM Upgrade feature. Bookings remitted before you upgraded the PM feature will appear on your legacy report versions.
The PM Owner Statement Summary Report is an income statement (i.e., Profit & Loss statement) that contains owner income and expense totals based on remittances.
Bookings
Once you have enabled the Property Management Upgrade, future bookings will include improved and detailed side-by-side Owner/PM information. You can check that out by navigating to a new booking in the future and the PM tab.
When you record a booking expense (Booking > Expenses tab > + Record Expense), you'll notice that the Owner Visibility section has been moved to Statement Views.
Other
The Property Management Upgrade Status has been added to the PM Settings section, allowing you to check your upgrade process and suggestions even after completing your review and marking the upgrade complete.